"It is not allowed to serve as the actual controller, shareholder, partner or other senior positions of private equity investment funds". This provision has been included for the first time in the prohibition of spouses, children and their spouses of leading cadres at the level of deputy directors and at or above the equivalent level from running businesses. This is one of the five prohibited situations specified in the Regulations on the Administration of Leading Cadres' Spouses, Children and Spouses Running Business Enterprises issued by the General Office of the CPC Central Committee a few days ago.
It is not a new topic for relatives of leading cadres to run businesses. In the opinion of experts, this new regulation not only clarifies the applicable leadership level, but also adds new prohibitions according to the changes in the anti-corruption situation, reflecting the clear orientation of precise management and strict governance.
Judging from the relevant typical cases investigated and handled by the discipline inspection and supervision authorities all over the country in recent years, the phenomenon of leading cadres' relatives running businesses has the common characteristics of common corruption problems such as power and money trading and interest exchange, and also shows new characteristics such as concealment and complexity with the endless emergence of various operational techniques.
Power and money transactions behind illegal business
The relatives of leading cadres who engage in business in violation of regulations often do not have much business talent, but they can often make a lot of profits, which is inseparable from the operation and influence of power. The reporter combed the relevant cases and found that it is the most common operation method to directly use the position convenience and authority influence of leading cadres to help their relatives to do business and make profits in their jurisdiction or field of employment.
For example, Liu Chuansheng, the son of Liu Chuansheng, the former secretary of the Party Committee of Beijing Normal University, once founded an educational technology company. In order to help his son make profits, Liu Chuansheng not only did not avoid purchasing the company's products, but also allowed him to open many kindergartens with the brand of Beijing Normal University in many places across the country in the name of Beijing Normal University.
"Although some profit-making behaviors are not within the jurisdiction of the leading cadres themselves, many businessmen will also buy them in consideration of their power influence," said a discipline inspection and supervision cadre who participated in the investigation and handling of several corruption cases involving the relatives of leading cadres. Wu Xincheng, former deputy director of the Shaanxi Provincial Development and Reform Commission and former director of the Shaanxi Provincial Grain Bureau, is an example.
In the early years, Wu Xincheng's wife Wang Moumou established a real estate company with others in the name of his brother-in-law, borrowed more than 40 million yuan from the chairman of a coal company in the province, and won the land use right of a piece of commercial land through auction. However, due to the downturn of the real estate market, considering that the loan term is approaching, Wu Xincheng came forward to negotiate with the coal company to purchase the land as soon as possible. After such operations, Wang not only successfully sold the land, but also earned more than 20 million yuan.
In addition to taking the initiative to help relatives make profits by taking advantage of their power, many businessmen also take a fancy to the power in the hands of leading cadres, and actively transfer benefits by approaching their relatives in order to obtain special care from leading cadres.
Yun Lei, the son of Yun Guangzhong, the former member of the Standing Committee of the Inner Mongolia Autonomous Region Party Committee and the former secretary of the Hohhot Municipal Party Committee, took advantage of his father's position to start the coal business.
In the previous anti-corruption storm involving coal in Inner Mongolia, Yun Lei, the son of Yun Guangzhong, the former member of the Standing Committee of the Inner Mongolia Autonomous Region Party Committee and the former secretary of Hohhot Municipal Party Committee, and Yun Kaichen, the son of Yun Zimin, the former general manager of China Huadian Group, who had worked in Inner Mongolia for a long time, started a coal business together.
In order to please Yunguangzhong, a private enterprise "wholesale" coal at a low price to the company where Yunlei and Yunkaichen work. However, Yunlei's company has no personnel, equipment, capital and actual business activities, and even the buyer is contacted by this private enterprise. Yun Lei and others just need to sign a contract and go through the formalities, and they can get tens of millions of yuan of coal transfer difference, which is not convenient and fast to make money. Of course, Yunguangzhong also later used its authority to provide support and assistance to the enterprise on multiple projects.
Of course, seeking benefits is only one of the purposes of leading cadres to connive relatives to run businesses. According to the investigators, in order to wash away corrupt funds, leading cadres often need their relatives to play the role of white gloves, covering up the fact of bribery with seemingly compliant market operations such as share investment, enterprise establishment, business cooperation, etc.
For example, when Jian Chunlin, the former director of the Council of Hainan Supply and Marketing Federation, received a reward of 5 million yuan from a businessman, in order to avoid risks, he asked his son and his high school classmates to register a company, and asked Zheng to transfer funds to the company in the name of "investment funds" in order to hide the truth.
From the above cases, it is easy to find that there is always a lingering power behind illegal business. This new regulation highlights the orientation of classified policy implementation while focusing on the cadres at or above the bureau level. For example, it is stipulated that the spouses of leading cadres directly under the central management and other department and bureau level leaders are not allowed to engage in business, and children and their spouses are not allowed to engage in business within their jurisdiction or within the business scope of the unit (system) where they work, the enterprise they belong to, and affiliated enterprises. For other relatively lower level leading cadres, the regulations also make corresponding allowance and adjustment.
"The reason is also very simple. The higher the level of leading cadres, the more power and influence they will have. The higher the standard, the more strict it will be, which also reflects the guiding role of grasping the key minority and strict governance." A professional focusing on anti-corruption research pointed out.
Capital operation under the cloak of "legality"
With the deepening of the fight against corruption, in order to avoid risks, it has become more and more common for leading cadres to achieve their goals without appearing through the soft influence of power, which undoubtedly increases the difficulty of case investigation.
The daughter of Zhao Zhengyong, the former secretary of Shaanxi Provincial Party Committee, is such a typical example. She worked in Shaanxi Branch of several commercial banks and got commission by pulling deposits for the bank.
On July 31, 2020, Zhao Zhengyong, former secretary of Shaanxi Provincial Party Committee, was sentenced to death with a two-year reprieve for bribery.
According to an insider of a bank, the daughter of Zhao Zhengyong obtained about 20 million yuan through commission. Since Zhao Zhengyong didn't say hello or approve the note, her own performance was also real. Although she received more money, according to the company's regulations, it was compliant and not illegal.
However, as an insider in the financial industry pointed out in his analysis, if there was not a father who was the secretary of the provincial party committee, it would be difficult for Zhao Zhengyong's daughter to attract so many businesses just by her own ability, which is undoubtedly the problem of benefit transmission.
"This is still a situation that is easy to identify. As long as its social relations are comprehensively investigated, abnormal situations can be found. However, there are many operating methods in the financial market. By using various tools and means, nesting and setting firewalls layer by layer, violations have long been covered up in normal market behavior, making it difficult to reverse corruption." The person said.
In order to cover up the fact of corruption, Zhu Huimin, the former secretary of the Party Committee and chairman of China Everbright Industry (Group) Co., Ltd., deliberately intertwined job related crimes with investment and business activities, and put loans, financing, investment, etc. under the "legal cloak" through professional operations, involving dozens of relatives and nearly 1000 hidden capital accounts, The capital transaction relationship is very complicated. Under the overall guidance of the Third Supervision and Inspection Office of the Central Commission for Discipline Inspection and the State Supervision and Inspection Commission, the case was finally cleared up through the comprehensive use of the tripartite linkage mechanism of "office group place".
"Judging from the regulations released this time, the CPC Central Committee has clearly noticed this problem, especially the special regulation of the investment and practice of private equity investment funds," said a researcher in the securities industry.
Different from the open securities market operation, due to the non-public nature of private equity funds, public disclosure of information is not required in many cases, which provides convenient conditions for the intervention of leading cadres. "Especially in the main links of private equity investment funds such as project acquisition, fund raising and resource development, it is easy to have the shadow of power."
After a comprehensive analysis of the operation methods of various cases, a cadre of the provincial discipline inspection commission told the reporter that in order to hide the truth, some leading cadres, under the guise of equity investment, often engage their families in the form of entrusted holding and anonymous investment, and make up cooperation agreements and current accounts, "This not only distorted the original normal market operation mechanism, but also caused disorderly expansion of capital."
Paid intermediary services with hidden variations
As an official who holds a large amount of public resources, he has not only the force and convenience brought by his position and authority, but also various information advantages unknown to outsiders, as well as the observation and judgment formed in long-term work experience.
In the view of an integrity researcher who has studied anti-corruption work for a long time, this asymmetric advantage in information and ability is often a scarce resource. As the closest person around leading cadres, relatives are the easiest to obtain these information. Leading cadres also consciously or unconsciously use their relatives as intermediaries to provide various intermediary services for their own illegal purposes or for units and individuals in need, which has become a more obscure way of power realization.
This phenomenon has attracted the attention of the Party Central Committee. It is prohibited to set up or jointly set up paid social intermediaries and legal service institutions, and to engage in paid social intermediaries and legal services in the areas under the jurisdiction of leading cadres or in the units (systems) where they work, which are also included in this regulation.
From the typical cases investigated and dealt with in recent years, there are no lack of such examples. Liu Yuansheng, the former husband of Zhang Jiahui, the former vice president of Hainan Higher People's Court, left the court system and cooperated with a lawyer to establish a consulting company to provide legal services for relevant enterprises and individuals. Of the 37 people who offered bribes to Zhang Jiahui, 24 asked for help through Liu Yuansheng. After receiving the request, Zhang Jiahui took advantage of his position to influence the court's decision by saying hello and other means. The property received illegally alone amounted to 43.75 million yuan.
In view of the above new trend of corruption, this new regulation has included it in the prohibition situation, and made it clear that the spouses, children and spouses of leading cadres who violate the above prohibition regulations should stop and withdraw from the corresponding business activities.
Of course, not all business activities relying on professional skills are prohibited. The new regulations also specify that the spouses, children and their spouses of leading cadres who work in universities and scientific research institutes and invest in or establish enterprises with personal patents and scientific and technological achievements are in line with the relevant policies of the state to encourage scientific and technological innovation, and may not be included in the situations that need to exit after their own application and organization identification.
Some experts believe that this reflects the principles of respecting knowledge, encouraging innovation and seeking truth from facts. It is helpful to improve the effectiveness of policy implementation and avoid the expansion of the scope of governance by distinguishing normal scientific research transformation activities from intentional benefit delivery. "However, we should also take into account the possible loopholes in the implementation level, and regulate the business of the relatives of leading cadres. We should not only define the behavior boundary of key relatives, but also focus on regulating the exercise of power of leading cadres themselves, and rein in the hands of abusing power and pursuing profits."
(Integrity Outlook)
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