Chinese real estate tycoon jailed for fraud

Shanghai property tycoon Zhou Zhengyi, one of China's richest businessmen, was sentenced Tuesday to a jail term of three years for stock market fraud and falsifying documents, sources with the Supreme People's Court said.

According to the sources, the Shanghai No. 1 Intermediate People's Court announced the verdict on Tuesday, about ten days after the trial of the real estate mogul from May 19 to 20.

Zhou was sentenced to two years and six months in prison for manipulating share prices and one year for falsifying registered capital reports. His final sentence was a total of three years in prison, the verdict said.

Shanghai-based Nongkai Development Group, a property firm controlled by Zhou, was sentenced to pay a total fine of 40 million yuan (about 4.82 million US dollars), including 33 million yuan (3.96 million US dollars) for manipulating share prices and seven million yuan (some 840,000 US dollars) for falsifying registered capital reports.

The two other defendants involved in the same case were also convicted, the sources said, but did not disclose any details.

According to the verdict, from June 1999 to May 2003, Zhou Zengyi was found manipulating stock prices through illegally buying and selling tradable shares of an engineering company in east China's Xuzhou city, owing 95.93 percent of the corporate shares at the peak time, which resulted in an unreasonable jump of 402 percent of the stock's price.

From October 1998 to April 2000, Zhou was also accused of fabricating Nongkai's paid-up capital from the original 100 million yuan (approximately 12 million dollars) to 800 million yuan (some 96 million dollars) with falsified capital surplus.

Zhou, ranking 11th in 2002 on Forbes magazine's list of the 100 richest people in China, had an estimated personal fortune worth 320 million US dollars before his arrest last September.

Statistics show that in 2002, the Shanghai-based Nongkai employed 4,000 workers and had a sales revenue of 540 million dollars.

The 42-old also headed the Hong Kong-listed Shanghai Land Holdings and Shanghai Merchants Holdings and two Shanghai-listed companies.