Chen Liangyu: Fired

Shanghai, Sept. 25 (Reuters): The Communist Party boss of Shanghai has been sacked for corruption, state media said today, toppling the highest leader so far in national party chief Hu Jintao’s drive to root out abuse and enforce loyalty.

Chen Liangyu was involved in misusing social security funds in China’s financial hub and helped enrich crony companies and relatives, Xinhua news agency reported, citing a Communist Party Politburo decision yesterday.

His fall, coming after months of speculation about his future, was viewed as a sign of Hu’s tightening grip on power, as he uses graft investigations and personnel changes to discipline wayward officials ahead of a crucial party congress next year.

Chen had “created malign political effects”, the agency said, citing the central leadership’s decision and sending a warning to other potential targets.

“Whoever it is, no matter how high his position, anyone who violates party rules or national law will be severely investigated and punished.”

Chen was also removed from the Politburo, the party’s powerful 24-member leadership council, the announcement said. It did not say whether Chen also faces criminal charges, as well as dismissal.

Chen was the first Politburo member to be sacked since 1995 when Beijing party chief Chen Xitong was purged and jailed. His details were promptly erased from the city government website, www.shanghai.gov.cn.

More than 100 central government investigators have descended on Shanghai in recent months to investigate money reportedly drained from the city’s 10 billion yuan ($1.25 billion) social security fund for illicit loans and investments.

A Beijing source said that two weeks ago investigators notified Chen, his driver and a domestic helper that they were to be questioned. The official announcement said Chen had protected staff involved in “grave law-breaking”.