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Probe of GOME founder spreads to provincial officials

Published 04/16/2009, 08:55 AM
Updated 04/16/2009, 09:00 AM

BEIJING, April 16 (Reuters) - A Chinese investigation into alleged financial misconduct by the founder of GOME Electrical Appliances has widened to include two provincial officials, Caijing magazine reported on Thursday.

The widening of the five-month probe, which has so far centered on allegations of stock market manipulation by detained Gome founder Huang Guangyu, could mean it is taking on a political cast.

Corruption investigations in China can be proxies for political struggles. In the most important recent case, a corruption investigation into a brash toll-road operator ended with the arrest and trial of Shanghai mayor Chen Liangyu, an ally of former Chinese president Jiang Zemin.

The chief of the disciplinary body in eastern Zhejiang province, Wang Huayuan, and the chairman of an advisory body in Guangdong province, Chen Shaoji were both detained for investigation this week in relation to Huang's case, Caijing said on its website.

The head of the Ministry of Public Security's economic investigation bureau and a subordinate were detained in January. That investigation had revealed "significant assets of unclear origin" held by Chen's family, Caijing said.

Chen was director-general of the public security department of Guangdong until 2000, while Wang served on the disciplinary body for Guangdong from 1998-2006.

GOME has been under new management since Huang's detention.

(Reporting by Lucy Hornby; Editing by David Fox)

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