"China's Madoff" Reportedly Secretly Executed For $460 Million Ponzi Scheme

A Chinese businessman who allegedly operated a Ponzi scheme that bilked nearly 60,000 victims out of $460 million has reportedly been secretly executed for his crimes.  Various news outlets are reporting that Zeng Chengjie was executed by lethal injection last Friday, July 12, 2013, after previously being sentenced to death (originally by firing squad) for "illegal fund-raising," which is the Chinese catch-all designation used for financial and investment fraud.  The execution has sparked outrage, particularly among Zeng's family who complained that they were not informed of the pending execution contrary to Chinese law.  

Zeng was once a highly-successful Chinese businessman whose talents were recognized and supported by China's ruling party.  Investor funds were used to support his company that placed bids for city development projects, including local landmarks and public facilities, in Jishou, a small city in Hunan. While these efforts were initially successful, a change in the ruling elite resulted in Chinese politicians withdrawing their investments, which triggered widespread panic among civilian investors.  

In a series of events described as highly suspicious by Zeng's attorneys, he was quickly jailed for masterminding the scheme, with his assets sold at fire-sale prices to a state-owned asset company that reportedly reaped a huge profit from the transactions.  The trial was also plagued with accusations of corruption and partiality, with Zeng's daughter alleging that Zeng's conviction was upheld by the Chinese Supreme Court only after the city leader of Hunan was appointed as chief justice.

The news has caused an uproar, particularly among Chinese nationals who noted that China's laws gives death row inmates the right to meet with family before an execution.  Zeng's daughter has alleged that she learned of the news two days after the execution and that she was not permitted to see her father's body before it was cremated.  The issue was further thrust into the spotlight after a Chinese intermediate court posted and then quickly deleted a message on a popular social media platform that China’s laws do not decree that a death row inmate must meet with his family before execution.  Many then pointed out that the Supreme People’s Court had actually issued an interpretation that did give death row inmates the right to meet with family. 

China differs from the United States in that it allows the imposition of the death penalty for nearly sixty offenses, including fraud and economic crimes.  This has resulted in China earning the distinction of having one of the highest amounts of annual executions, including approximately 4,000 executions in 2011 alone.  Notably, this has included death sentences for several women accused of high-profile Ponzi schemes, including Wang Caiping, was sentenced to death last year after an investment fraud that racked up losses of nearly $20 million through risky futures and gold trading, and Wu Ying, who had been sentenced to death for a $60 million Ponzi scheme.  As is commonly permitted in China, Ying had her sentence reduced in May 2012 to "death with a two-year reprieve" as is commonly done where courts deem the perpetrator sufficiently reformed.