Chip-making company head sentenced to death for embezzlement

Zhao Weiguo, former chairman of Tsinghua Unigroup, a major Chinese integrated circuit manufacturer and a giant in the chip-making world, was sentenced to death with a two-year reprieve over crimes of embezzlement, providing illegal profits for relatives and friends and harming the interests of the listed companies by a court in Jilin province on Wednesday.

From 2018 to 2021, taking advantage of his position as chairman of Tsinghua Unigroup, Zhao conspired with a specific individual Li Luyuan, to have a company controlled by Li purchase properties at a low price that should have been purchased by Tsinghua Unigroup, thereby obtaining inflated profits from the properties and illegally appropriating state-owned assets worth over 470 million yuan ($65.25 million), the Intermediate People's Court of Jilin city said in a statement.

Also, from 2014 to 2021, Zhao entrusted profitable business operations of his company to specific individuals including Li, or purchased construction and management services from companies managed by Li at prices significantly higher than the market rate, resulting in a direct economic loss to the state of over 890 million yuan, the court said.

It added that in 2019, Zhao also instructed directors of a listed company under his control to lease company projects to a company managed by Li at a price significantly below market value, causing the listed company to suffer an economic loss of over 46.45 million yuan.

Zhao's embezzlement amount is particularly large, causing significant losses to national interests, which warrants the death penalty. He has caused significant losses to national interests by illegally profiting for relatives and friends, and by betraying trust and harming the interests of a listed company, also resulting in significant losses, the court said.

Considering that Zhao confessed his crimes truthfully upon being brought to justice, voluntarily disclosed aspects of the crimes that were not known to the investigating authorities, and showed repentance and actively returned the embezzled funds and properties, all of which have been recovered, and exhibited significant meritorious conduct, the death penalty imposed for the embezzlement offense may not be executed immediately, it said.

Also, for the offenses of providing illegal profits for relatives and friends and betraying trust and harming the interests of a listed company, a lighter punishment may be considered. The court hereby handed down the sentence, it added.