Shanghai Social Security Fund Scandal Marked 20th Anniversary this Year
This year marks the 20th anniversary of the Shanghai social security fund scandal. More than 20 officials and businessmen who were imprisoned at the time have been gradually released from prison, including former Shanghai Municipal Party Secretary Chen Liangyu. Reports indicate that he was released from prison nearly half a year ago. Chen Liangyu was accused of being a close associate of former Communist Party leader Jiang Zemin. The social security scandal was accused of concealing facts, handing down light sentences for grave crimes, allegedly due to its connection to Jiang Zemin’s son and the entire “Shanghai clique.”
According to a report by Hong Kong’s “Sing Tao Daily” on January 21, Chen Liangyu has been out of prison for nearly half a year and is currently living quietly in Shanghai. Sources say that Chen Liangyu left Beijing’s Qin Cheng Prison in the second half of last year and may spend his retirement in Shanghai.
Born in Shanghai and with roots in Ningbo, Chen Liangyu, who will turn 80 this October, once held a high position in the Communist Party’s Central Political Bureau.
In July 2006, the Shanghai Municipal Labor and Social Security Bureau Director Zhu Junyi was investigated for embezzling 3.2 billion yuan (RMB), leading to the revelation of the multi-billion yuan Shanghai social security fund scandal. Subsequently, others investigated included Fu Xi Investment Chairman Zhang Rongkun, Shanghai Electric Chairman Wang Chengming, Chen Liangyu’s former secretary and then Shanghai Baoshan District Director Qin Yu. On September 24 of the same year, Chen Liangyu, who was the Shanghai Municipal Party Secretary at that time, was dismissed from his position and placed under investigation.
On July 26, 2007, Chen Liangyu was expelled from the Party, removed from public office, and brought to legal prosecution. Official reports indicated that Chen Liangyu supported the illegal lending of huge social security funds by the Shanghai Municipal Labor Security Bureau to unlawful business owners and related companies, aiding them in acquiring state-owned company shares, using his authority for personal gain, and accepting money or goods either for himself or his family.
Chen Liangyu was also accused of “moral corruption, using power to exploit women, engaging in power and sex trades.” The “Legal Weekly” once exposed that Zhang Rongkun used model Lu Jiali to seduce high-ranking officials, filming their “indecent videos” with a pinhole camera each time. The “Jinghua Times” reported that “Chen Liangyu’s mistress had three abortions.”
Ultimately, prosecutors charged Chen Liangyu with accepting bribes totaling over 2.39 million yuan and two counts of abuse of power directly related to the Shanghai social security case, with the charge of dereliction of duty involving assisting his brother Chen Liangjun in making a profit of 118 million yuan.
On April 11, 2008, Chen Liangyu was sentenced to 18 years in prison for bribery and abuse of power by the Tianjin Second Intermediate People’s Court, with a confiscation of personal assets amounting to 300,000 yuan. The charge of dereliction of duty was not upheld. He was the first high-ranking Communist official sentenced after entering the 21st century.
After being sent to Qin Cheng Prison, rumors circulated in 2016 and 2020 about Chen Liangyu being released early, but they proved to be unfounded.
On December 20, 2017, CCTV released a report on the situations of corrupt officials in prison. It mentioned that Chen Liangyu was detained in a single-cell room of nearly 20 square meters, furnished with a separate bathroom and sitting toilet. He often wore suits but without a tie. He once requested to improve the prison food with his own funds, listing desired items such as red wine and peach kernels, but the request was denied.
Chen Liangyu was believed to be a close associate of former CCP leader Jiang Zemin.
According to the book “The Real Jiang Zemin,” in March 1984, when Chen Liangyu was the Party Secretary of the Shanghai Electrical Industry Company, he learned that the wife of the then Minister of the Electronics Ministry, Jiang Zemin, Wang Yeping, was the deputy head of the general office of an electrical research institute under his company. He saw this as an opportunity to ingratiate himself with and please Jiang. Since then, Chen often visited the electrical research institute to establish a relationship with Wang Yeping, promote her position, and elevate her to head of the general office.
Chen frequently visited Wang’s home, showed his care and concern, and even provided the best medical treatment when she fell ill. Upon learning that Jiang’s younger son Jiang Miankang was working as a laborer in a factory in Shanghai, Chen promptly arranged for him to be transferred to the electrical research institute where Wang worked. Subsequently, he allocated funds from the institute to enable Jiang Miankang to study at the Shanghai Workers’ Amateur University.
These actions by Chen earned deep gratitude from Wang. After Jiang Zemin assumed power in Zhongnanhai in the aftermath of the Tiananmen Square crackdown in 1989, Chen was subsequently promoted and served as the Deputy Secretary-General of the Shanghai Municipal Party Committee, Deputy Secretary of the Municipal Party Committee, Acting Mayor, Mayor, Secretary of the Municipal Party Committee, and member of the CCP Political Bureau.
Hong Kong media previously reported that in early 2000, Jiang Zemin had begun arranging for Hu Jintao’s successor from among the “Shanghai clique” and ultimately selected Chen Liangyu. If Chen had not encountered trouble in 2006, the current General Secretary of the CCP might not have been Xi Jinping but Chen Liangyu. Xi Jinping took over as the Shanghai Municipal Party Secretary after Chen Liangyu was investigated.
According to the “New Beijing News,” Chen Liangyu’s only son, Chen Weili, was implicated in the Shanghai social security fund scandal. In 2004, Wang Zheng, the Deputy General Manager of Huawen Company, appointed Chen Weili as the General Manager of its subsidiary, Zhongti Media Company, and named him the Deputy General Manager of Huawen Hong Kong, receiving a high salary. Chen Weili, then 33, earned a total salary of one million yuan per year. Subsequently, Huawen received 1 billion yuan in irregular entrusted loans from the Shanghai social security fund through Chen Weili’s assistance.
Shanghai rights lawyer Zheng Enchong, who has been dedicated to exposing the “Shanghai clique” including Chen Liangyu, described the day of Chen Liangyu’s sentencing as a day of “concealment of major facts, leniency for serious crimes, official completion but not real closure.”
On April 13, 2008, Zheng Enchong wrote an article in Da Ji Yuan, saying that the investigation into the social security fund case started in 2006. After Chen Liangyu was implicated, the authorities dared not investigate further because some high-ranking officials promoted by Jiang Zemin, such as Chen Liangyu’s predecessor Huang Ju, and Han Zheng, who was the mayor of Shanghai when Chen Liangyu was the Shanghai party secretary, were all involved. Jiang Zemin’s two sons, Jiang Mianheng and Jiang Miankang, were also implicated. If the investigation were to continue, “it wouldn’t just be Chen Liangyu who would fall, but the entire ‘Shanghai clique’.”