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ORK,YORK, FRIDAY, OCTOBER 26, 2012
EW FRIDAY, . OCTOBER 26, 2012
VOL. CLXII . No. 55,936

© 2012 The New York Times
NEW YORK, FRIDAY, OCTOBER 26, 2012

66. Weather map is on Page B12.

$2.50 $2.50
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NEW YORK, FRIDAY, OCTOBER 26, 2012

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2 CHILDREN SLAIN
Amassed in the
N SLAINSLAIN Billions Amassed thethe Shadows
Billions Amassed ininin the Shadows Premier
Obama Campaign Endgame: AT HOME IN CITY;
LDREN SLAIN BillionsAmassed Billions Shadows Shadows
ILDRENGrunt Work and Cold Math the Family of China’s
By
IN CITY;
OME IN CITY;
HOMEIN CITY; ByBy the Family of China’sPremier the Family of of China’s Premier
By the NANNY ARRESTED China’s Premier
Family
RRESTED
NY ARRESTED
NNYARRESTED
POLITICAL MEMO

Many relatives of Wen Jiabao, including his son, daughter, younger brother and brother-in-law, have become extraordinarily wealthy during his leadership.

By JIM RUTENBERG

post-debate movement in the
CHICAGO — This is what polls has peaked, Mr. Obama’s
“grinding it out” looks like at
President Obama’s election head- campaign technicians — and that’s what many of them are — quarters: scores of young staff are putting as much faith in the members intently clicking away multimillion-dollar machine they at computer keyboards as they built for just such a close race as crunch gigabytes of data about in the president himself. which way undecided voters are
“We are exactly where I leaning, where they can be thought we would be, in a very reached, and when; strategists close election with 12 days left standing at whiteboards busily with two things to do and two writing and erasing early voting things only: persuade the undenumbers and turnout possibilicided and turn our voters out,” ties; a lonely Ping-Pong table. said Jim Messina, 43, the presiThe wave of passion and exdent’s technocratic campaign citement that coursed through manager, slightly paler and more
Mr. Obama’s headquarters here hunched than he was when the in 2008 has been replaced with a campaign began. Pointing to the methodical and workmanlike approach to manufacturing the win- rows of personnel outside his office on Thursday, he added, “Evning coalition that came together more organically and enthusiasti- erything in that room has been cally for him the last time, a more focused on that.”
MOTHER
arduous task with no guarantee
MOTHER Four years ago, Mr. Obama’s
YANG ZHIYUN was preparing
WENDY RUDERMAN political team here of success.
YANG
UDERMAN Washington and the cable ZHIYUNMOTHER one of its trademark showstopAs
YANG ZHIYUN nd MARC SANTORA
ENDY RUDERMAN pers: a half-hour prime-time pronews
ANTORA commentariat breathlesslyHad investments in
Had investments in
MARC SANTORA to Romney’sher namein Ping An A23 discuss whether
Had investments in
Continued on Page her returned home Mitther

BOY AND GIRL STABBED

Wen Jiabao

Many relatives of Wen Jiabao, including his son,his son, daughter, younger brother and daughter, younger brother and
Many relatives of Wen Jiabao,Found Them —
Many relatives of Wen Jiabao, including his son, daughter, younger brother and
Mother including brother-in-law, have becomebecome extraordinarily wealthyhis his leadership. extraordinarily wealthy during during his leadership. brother-in-law, have become extraordinarily wealthy during leadership. brother-in-law, have

L STABBED
ANDGIRL STABBED
D GIRL STABBED

Suspect Cut Her Own
Throat, Police Say
By WENDY RUDERMAN and MARC SANTORA

MOTHER

YANG ZHIYUN

Had investments in her name in Ping An
Insurance once worth
$120 million.

Wen JiabaoJiabao
Wen Wen
Jiabao

PRIME MINISTER OF CHINA

Has said leaders should ensure that family members and friends
“do not abuse government influence.”

PRIME MINISTER OFOF CHINA
CHINA
PRIME MINISTERMINISTER OF CHINA
PRIME

Has said leaders should
Has said leaders should

Has said leaders should
A mother returned home to her ensure that family ensure that family luxury Upper West Side apartensure that family ment on Thursday evening to members and friends members and friends find two of her children, a 2-yearmembers and friends
“do not abuse govern“do not abuse governold boy and a 6-year-old girl, faWIFE
“do not abuse governtally stabbed in a bathtub by the ment influence.”
ZHANG BEILI ment influence.” family’s nanny, the authorities ment influence.”
Is an expert in gems said. The nanny herself lay on the and a force in the floor, near a bloody knife, with an nation’s diamond trade. apparently self-inflicted slash to her own throat.
Police Commissioner Raymond
REUTERS
W. Kelly said the mother, Marina
BROTHER
Krim, had left her apartment a
WEN JIAHONG block from Central Park at 57
Controls $200 million
West 75th Street to take one of her name in Ping An in assets, including her name in Ping An
Upper West Side apart- Insurance once worth her children, a 3-year-old girl, to waste treatment
Insurance once worth a swimming lesson. The two oth$120 once plants and recycling n Thursday evening to
Insurancemillion.worth
er children were left with the businesses. $120 million. of her children, a 2-yearnanny, Yoselyn Ortega, 50.
WIFE’S BROTHER
$120 million.
ZHANG JIANMING
When Ms. Krim returned and a 6-year-old girl, faaround 5:30 p.m., the commisInvested in diamond
SON
DAUGHTER
WIFE
bbed in a bathtub by the sioner said, she found a dark
WEN
WEN YUNSONG companies with his
ZHANG BEILI RUCHUN
WIFEHolds shares of a Chinese apartment. She went back down sister’s colleagues.
Co-founded a major private equity nanny, the authorities
WIFE
to the lobby to ask the doorman if firm called New HorizonIsZHANG BEILI gems
Capital.expert diamond company. an in
THE NEW YORK TIMES e nanny herself lay on the he had seen the nanny and her
ZHANG BEILI and a force in the children. When told that they had
Is an expert in gems ar a bloody knife, with an
Is an expert in politically not left the building, she returned nation’s diamond trade. gems connected people have
By DAVID BARBOZA and a force AREthe tly self-inflicted slash to to the apartment. She looked
TIMES WEB SITES in BLOCKED profited from being at the inand a force in the
BEIJING — The mother of Chiaround in the quiet rooms. Fination’s diamondto an article tersection of government and throat. China blocked access trade. nally, she turned the lights on in na’s prime minister was a schoolon wealth nation’s diamond trade. as state influence and accumulated by the business the bathroom — and discovered teacher in northern China. His faCommissioner Raymond
REUTERS
prime minister’s family. Page A12. private wealth converge in Chiher two children in the bathtub ther was ordered to tend pigs in na’s fast-growing economy. said the mother, Marina and the nanny unconscious on one of Mao’s political campaigns.
BROTHER
Unlike most new businesses in
And during childhood, “my fam- years later as prime minister.
REUTERS
the floor. ad left her apartment a
WEN JIAHONG
China, the family’s ventures
REUTERS
“There were bloodcurdling ily was extremely poor,” the
Many relatives of Wen Jiabao, sometimes received financial om Central Park at 57 BROTHER $200 million screams from a woman,” said prime minister, Wen Jiabao, said including his son, daughter,
Controls
BROTHER backing from state-owned comth Street to take one of JIAHONG DAMON WINTER/THE NEW YORK TIMES Rima Starr, who lives down the in a speech last year.
WEN
younger brother and brother-inin assets, including
WEN JIAHONG
But now 90, the prime min- law, have become extraordinarily panies, including China Mobile, hall from the victims’ secondPresident Obama cast his early ballot Thursday in Chicago. dren, a 3-year-old girl, to $200 million
Controls
floor apartment. Ms. Starr also ister’s mother, Yang Zhiyun, not wealthy during his leadership, an one of the country’s biggest waste $200 million
Controls treatment recognized a man’s screaming only left poverty behind — she investigation by The New York phone operators, the documents ming lesson. The two in assets,plants and recycling othincluding voice as that of the building su- became outright rich, at least on Times shows. A review of corpo- show. At other times, the venin assets, including ren were left with the perintendent.The screams paper, according to corporate rate and regulatory records in- tures won support from some of businesses. waste treatment waste treatment prompted neighbors to call 911. and regulatory records. Just one dicates that the prime minister’s Asia’s richest tycoons. The Times
Yoselyn Ortega, 50.
WIFE’S BROTHER plants and recycling
Ms. Ortega was arrested as soon investment in her name, in a relatives, some of whom have a found that Mr. Wen’s relatives acZHANG JIANMING
Ms. Krim returned plants and recycling as the police arrived. She was large Chinese financial services knack for aggressive deal-mak- cumulated shares in banks, jewbusinesses. taken SONNewYork-Presbyterian company, had a value of $120 mil- ing, including his wife, have con- elers, tourist resorts, telecomto
5:30 p.m., the commisbusinesses.
Invested in diamond
DAUGHTER
WIFE’S BROTHER
Hospital/Weill Cornell Medical years ago, the records trolled assets worth at least $2.7 munications companies and insaid, she found a dark
WEN YUNSONG was in critical lion five WEN RUCHUN companiesWIFE’Shis with BROTHERprojects, sometimes frastructure ZHANG JIANMING
Center, where she show. billion.
By JONATHAN WEISMAN
ZHANG using offshore entities.
JIANMING
but stable condition. equity nt. She went back down
The details of how Ms. Yang, a sister’s colleagues.
Co-founded a major private police, Ms. Holds shares of a Chinese In many cases, the names of byThe holdings include a villa deWASHINGTON — The Indiana Jennifer Duffy, a Senate political
SON According to the
DAUGHTER such wealth the relativesInvested in diamond accumulated have been Invested in diamond hidden bby to ask the candidate Richard E. analyst at the nonpartisan Cook Krim andSON husband, Kevin, widow, known, or company.
DAUGHTER
Senate doorman if diamond even if she was behind layerscompanies and velopment project in Beijing; a firm called New Horizon Capital. her are not RUCHUN
THE NEW YORK TIMES of partnerships with his
WEN
WEN YUNSONG
Mourdock’s reintroduction of Political Report. “It’s just getting had three children — Nessie, the aware of the holdings in her investment vehicles involving tire factory inhis seen the nanny and her
WEN RUCHUN
WEN YUNSONG companies with northern China; a rape and abortion into the politi- a lot harder.” sister’s colleagues. and company that helped build some
Holds shares happened after her friends, a Chinese
Co-founded a di- 3-year-old who lived,
. When told that they had the lat- Rob Jesmer, the executive major private equity and aLucia name. But itof shares of rul-Chinese work colleaguessister’s colleagues. stadiums, incal dialogue this week is and a major private blog
Holds
Co-founded Leo. Ms. Krim wrote equity son was elevated to China’s a business partners. Untangling of Beijing’s Olympic est in she returned a series of political mis- rector of the National Republican Horizon Capital. firm called New where she documented “life with diamondfirst in 1998 as vice their financial holdings NEW YORK TIMES the well-known “Bird’s cluding he building, ing elite, company. company.
THE
politically connectedprovidesTHE NEW diamond By DAVID BARBOZA
Senatorial
Committee,firm called New Horizon Capital. prime minister and then five an unusually detailed lookpeople haveYORK TIMES said steps that made the at how
Continued on Page A3
Continued on Page A14 apartment. questhave looked Repub- Thursday that Republican candiTIMES WEB SITES ARE BLOCKED lican She seize control of the to profited from being at the inBEIJING — The mother of Chidates were within reach of vicSenate rooms. Fiin the quiet a steeper climb. tersection of government and
China blocked access to an article
10
Once viewed win prime minister e turned the lights as likelyare now tory in BARBOZA was a schoolon in to na’s with Mr. to 12 competitive races, the Senate, Republicans By DAVID Romney’s improvement on wealth accumulated by the business as state influence and polls lifting BARBOZA jeopardy of losing seats in in thein northern China. hroom —in and discovered teacherBy DAVIDcandidates in His faTIMES WEB SITES ARE BLOCKED A12. private wealth converge in Chiprime minister’s family.ARE BLOCKED
TIMES WEB SITES Page
Massachusetts and Maine.ther states that were outto play sixpigs in
If
wasago. ordered of tend children indo, they bathtub win at weeks the will need to third release stated Mr. Pandit they na’s fast-growing economy. a longtime lieutenant. nanny least five seats heldon Demo- ofBut time is politicalThe im- By JESSICA SILVER-GREENBERG had been fired without cause. unconscious by one Mao’s dwindling. campaigns.
“Vikram has offered his resigUnlike most new businesses inand we would like to give plications for the next two years
The choice was his. crats and hold three other Repubnation, and years later
And during childhood, “my fam- SUSANNE CRAIG as prime minister.
.
lican seats at risk to net the three cannot be overstated. If Mr. Obayou the opportunity to offer
The abrupt encounter, China, dethe family’s ventures the hand e were bloodcurdling if Mitt ma wins extremely hispoor,” Vikram Pandit’s last relatives of Wen Jiabao, briefed yours,” a board member said, folneeded to take the Senate ily was a second term,
Many day at scribed by three people would be much strengthened by Citigroup swung from celebralowing
Romney wins the said minister, Senate, even a said including his son, daughter, sometimes received financiala script prepared by the from a Ifwoman,” presidency. primeDemocratic-led Wen Jiabao,tory to devastating in a matter of on the conversation, included a terse comment by the chairman,
President Obama prevails, a backing from state-owned board’s people with according to com- lawyers, knowledge of in narrowly last one, as arr, who lives down the win ata speechdividedyear. opposed minutes. Having fielded congrat- Michael E. O’Neill: “The board several Republicans will have to younger brother and brother-into the meeting. least one additional seat in aBut unified Republican majorities ulatory e-mails about the earn- has lost confidence in you.” panies, including China Mobile, now and the prime ings report law, have become extraordinarily min- in the morning that m the victims’ second-seen as in the House 90, the Senate.
Startled, Mr. Havens briefly state where they are
A stunned Mr. Pandit chose to ister’s the moment, Democrats are suggested wealthy during resign immediately. an one artment. Ms.behind — in Connecticut, Atmother, Yang Zhiyun, not the bank was finally his leadership,Even though of the country’s biggest the directors, pointing challenged slightly Starr also more phone operators, the documents performance of the into the solid
Florida, screaming
CARLOS OSORIO/ASSOCIATED PRESS ed a man’s Ohio or Pennsylvania.onlygiven little chance of winning the —onsheinto theground, Mr. PanditbyMr. Pandit and the board have left poverty behind strode solid office of the chairinvestigation publicly characterized his exit as
The New York stitutional clients group, and then
Continued on Page A22
“Republicans can do it,” said show. At other venthat of the building su- became outright rich, at least on day’s end on shows. A his decision,of corpo- peo- Vikram S. Pandit times, the relented, saying his resignation man at
Times Oct. 15 for review interviews with from some ofbe what he considered just another ple close to the board describe dent.The screams paper, according to corporate frequent meetings regulatory records in- tures won support first meet- would five on Mr. Pandit’s desk rate and on his how the chairman maneuvered tive’s ouster, they say, of their minutes. Asia’s privately tycoons. The within dramatic boardroom coup d neighbors to call 911. EL ECTION 2012 and regulatory records. Just one dicates that the behind the scenes for months ing richest with less-satisfied Times calendar. The prime minister’s found that Mr. Wen’s relatives acInstead, Mr. Pandit, the chief ahead of that day to force Mr. board members and then draw- at the bank’s Park Avenue headega was $2 BILLION CAMPAIGN President Obama and Mitt Romney are each on in a relatives, some of whom have a arrested as soon investment in her name, executive of Citigroup, was told and replace him with ing in others until Mr. Pandit had quarters has rankled some peopace to raise more with cumulated allies left. jewpolice arrived. She than $1 billionJO CRAVEN parties by PAGE A18 Day. services knack were ready. Pandit outdeal-mak- board’s virtually noshares in banks,ple at Citi, especially senior execwas largetheir MCGINTY, Election
Chinese financial three news releases for aggressive L. Corbat, the
Michael
BY NICHOLAS CONFESSORE AND elers, Astourist was reeling from utives who feel that the action
Mr. Pandit resorts, telecomOne stated that Mr. Pandit had chosen successor.

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Ms. Krim returned the commis30 p.m., the commisfound a dark d, she found a dark ent back down
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By DAVID BARBOZA en the nanny and her d that they had
When told that they had g, she returned
BEIJING
became outrightpolitically connected people accordrich, at least on paper, politically connected e building, she returned
Citi Chairman Is Said to Have Planned being people have have
Over Months
t. She looked profited from Chief’s Exitrecords. partment. She looked mother of China’s prime minister he ing to corporateprofitedregulatory in- the in- Just and fromat the at
BEIJING — The mother of Chibeing iet rooms. FiBEIJING — The mother of Chi- blocked access to an article tersection of government and the quiet rooms. Fiminister was a school- China China blocked access to an article tersection of government and he lights on in na’s primeschoolteacherwas anorthern China. was na’s one the business as state influenceaand large Chinese turned the lights teacher a northern minister in schoolon in in prime China. His fa- on wealth accumulated byinvestment in her name, in influence and the business as state nd discovered northern China. prime on wealth accumulated services company, had a value of
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Page A12. private private wealth converge n the bathtub ther was ordered ther in prime minister’s family. Page hildren in the bathtub Mao’s was ordered to tend pigs And during na’s fast-growing economy. million five years ago, the records show. political campaigns. na’s fast-growing economy. nconsciousone of Mao’s politicalcampaigns. on one of one of Mao’s political campaigns. nanny unconscious on
Unlike most new businesses in
And during childhood,was extremely later as prime minister.
“my fam- years poor,” the childhood, “my during childhood, “my fam- years later as primeThe details of Unlike Ms. new businesses in achow most ventures
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China, the family’s Yang, a widow, minister. extremely poor,” bloodcurdling ily wasily was extremely the poor,” Many relativesrelatives Jiabao, Jiabao, China, the family’s ventures even the a speechof Wen of Wen sometimes received not known, or were bloodcurdling minister,Wen Jiabao, said prime minister, Wen Jiabao, said in cumulated such wealth are financial
Many
woman,” said prime including his from a woman,” said prime minister, Wen Jiabao, said includingson, daughter, backing sometimes received financial from state-owned comhisif son, was aware of the holdings in her name. she daughter, backing ives down last year. in a speech last year. the in a speech last year. younger brother and brother-in- panies, includingfrom state-owned comr, who lives down the
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But now90, the prime minister’s mother,
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But it happened after her son China elevated to was prime minthe victims’ secondone the country’s biggest
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Zhiyun, behind, she leadership, an phone tment. Ms. Starr Zhiyun, not only left povertynot wealthy during his leadership, an elite, first in 1998 as vice prime also Yangonly leftister’s mother, Yang she investigation by The New York ruling operators, the documents
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York
he building su- became outright rich, at least on Times shows. A review ofThe New show. At other times, the ven-the venshow. At times, corpohat of the building su- became outright rich, at least on Times shows. A review of corpo- won support other some of tures from

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minister and then five years later as prime minister.
Many relatives of Wen Jiabao, including his son, daughter, younger brother and brotherin-law, have become extraordinarily wealthy during his leadership, an investigation by The
New York Times shows. A review of corporate and regulatory records indicates that the prime minister’s relatives — some of whom, including his wife, have a knack for aggressive deal making — have controlled assets worth at least $2.7 billion. In many cases, the names of the relatives have been hidden behind layers of partnerships and investment vehicles involving friends, work colleagues and business partners. Untangling their financial holdings provides an unusually detailed look at how politically connected people have profited from being at the intersection of government and business as state influence and private wealth converge in China’s fastgrowing economy.
Unlike most new businesses in China, the family’s ventures sometimes received financial backing from state-owned companies, including China Mobile, one of the country’s biggest phone operators, the documents show. At other times, the ventures won support from some of
Asia’s richest tycoons. The Times found that Mr.
Wen’s relatives accumulated shares in banks, jewelers, tourist resorts, telecommunications companies and infrastructure projects, sometimes by using offshore entities.
The holdings include a villa development project in Beijing; a tire factory in northern
China; a company that helped build some of
Beijing’s Olympic stadiums, including the wellknown “Bird’s Nest”; and Ping An Insurance, one of the world’s biggest financial services companies. As prime minister in an economy that remains heavily state-driven, Mr. Wen, who is best known for his simple ways and common touch, more importantly has broad authority over the major industries where his relatives have made their fortunes. Chinese companies cannot list their shares on a stock exchange without approval from agencies overseen by Mr. Wen, for example. He also has the power to influence investments in strategic sectors like energy and telecommunications. Because the Chinese government rarely

makes its deliberations public, it is not known what role — if any — Mr. Wen, who is 70, has played in most policy or regulatory decisions.
But in some cases, his relatives have sought to profit from opportunities made possible by those decisions.
The prime minister’s younger brother, for example, has a company that was awarded more than $30 million in government contracts and subsidies to handle wastewater treatment and medical waste disposal for some of China’s biggest cities, according to estimates based on government records. The contracts were announced after Mr. Wen ordered tougher regulations on medical waste disposal in 2003 after the
SARS outbreak.
In 2004, after the State Council, a government body Mr. Wen presides over, exempted
Ping An Insurance and other companies from rules that limited their scope, Ping An went on to raise $1.8 billion in an initial public offering of stock. Partnerships controlled by Mr. Wen’s relatives — along with their friends and colleagues
— made a fortune by investing in the company before the public offering.
In 2007, the last year the stock holdings were disclosed in public documents, those partnerships held as much as $2.2 billion worth of
Ping An stock, according to an accounting of the investments by The Times that was verified by outside auditors. Ping An’s overall market value is now nearly $60 billion.
Ping An said in a statement that the company did “not know the background of the entities behind our shareholders.” The statement said,
“Ping An has no means to know the intentions behind shareholders when they buy and sell our shares.” While Communist Party regulations call for top officials to disclose their wealth and that of their immediate family members, no law or regulation prohibits relatives of even the most senior officials from becoming deal-makers or major investors — a loophole that effectively allows them to trade on their family name. Some
Chinese argue that permitting the families of
Communist Party leaders to profit from the country’s long economic boom has been important to ensuring elite support for market-oriented reforms.
Even so, the business dealings of Mr. Wen’s relatives have sometimes been hidden in ways

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that suggest the relatives are eager to avoid public scrutiny, the records filed with Chinese regulatory authorities show. Their ownership stakes are often veiled by an intricate web of holdings as many as five steps removed from the operating companies, according to the review.
In the case of Mr. Wen’s mother, The Times calculated her stake in Ping An — valued at $120 million in 2007 — by examining public records and government-issued identity cards, and by following the ownership trail to three Chinese investment entities. The name recorded on his mother’s shares was Taihong, a holding company registered in Tianjin, the prime minister’s hometown. The apparent efforts to conceal the wealth reflect the highly charged politics surrounding the country’s ruling elite, many of whom are also enormously wealthy but reluctant to draw attention to their riches. When Bloomberg
News reported in June that the extended family of Vice President Xi Jinping, set to become
China’s next president, had amassed hundreds of millions of dollars in assets, the Chinese government blocked access inside the country to the Bloomberg Web site.
“In the senior leadership, there’s no family that doesn’t have these problems,” said a former government colleague of Wen Jiabao who has known him for more than 20 years and who spoke on the condition of anonymity. “His enemies are intentionally trying to smear him by letting this leak out.”
The Times presented its findings to the
Chinese government for comment. The Foreign Ministry declined to respond to questions about the investments, the prime minister or his relatives. Members of Mr. Wen’s family also declined to comment or did not respond to requests for comment.
Duan Weihong, a wealthy businesswoman whose company, Taihong, was the investment vehicle for the Ping An shares held by the prime minister’s mother and other relatives, said the investments were actually her own. Ms. Duan, who comes from the prime minister’s hometown and is a close friend of his wife, said ownership of the shares was listed in the names of
Mr. Wen’s relatives in an effort to conceal the size of Ms. Duan’s own holdings.
“When I invested in Ping An I didn’t want to be written about,” Ms. Duan said, “so I had my

relatives find some other people to hold these shares for me.”
But it was an “accident,” she said, that her company chose the relatives of the prime minister as the listed shareholders — a process that required registering their official ID numbers and obtaining their signatures. Until presented with the names of the investors by The Times, she said, she had no idea that they had selected the relatives of Wen Jiabao.
The review of the corporate and regulatory records, which covers 1992 to 2012, found no holdings in Mr. Wen’s name. And it was not possible to determine from the documents whether he recused himself from any decisions that might have affected his relatives’ holdings, or whether they received preferential treatment on investments.
For much of his tenure, Wen Jiabao has been at the center of rumors and conjecture about efforts by his relatives to profit from his position.
Yet until the review by The Times, there has been no detailed accounting of the family’s riches.
His wife, Zhang Beili, is one of the country’s leading authorities on jewelry and gemstones and is an accomplished businesswoman in her own right. By managing state diamond companies that were later privatized, The Times found, she helped her relatives parlay their minority stakes into a billion-dollar portfolio of insurance, technology and real estate ventures.
The couple’s only son sold a technology company he started to the family of Hong
Kong’s richest man, Li Ka-shing, for $10 million, and used another investment vehicle to establish New Horizon Capital, now one of China’s biggest private equity firms, with partners like the government of Singapore, according to records and interviews with bankers.
The prime minister’s younger brother, Wen
Jiahong, controls $200 million in assets, including wastewater treatment plants and recycling businesses, the records show.
As prime minister, Mr. Wen has staked out a position as a populist and a reformer, someone whom the state-run media has nicknamed “the
People’s Premier” and “Grandpa Wen” because of his frequent outings to meet ordinary people, especially in moments of crisis like natural disasters.
While it is unclear how much the prime minister knows about his family’s wealth, State De-

partment documents released by the WikiLeaks organization in 2010 included a cable that suggested Mr. Wen was aware of his relatives’ business dealings and unhappy about them.
“Wen is disgusted with his family’s activities, but is either unable or unwilling to curtail them,” a Chinese-born executive working at an
American company in Shanghai told American diplomats, according to the 2007 cable.

China’s ‘Diamond Queen’
It is no secret in China’s elite circles that the prime minister’s wife, Zhang Beili, is rich, and that she has helped control the nation’s jewelry and gem trade. But her lucrative diamond businesses became an off-the-charts success only as her husband moved into the country’s top leadership ranks, the review of corporate and regulatory records by The Times found.
A geologist with an expertise in gemstones,
Ms. Zhang is largely unknown among ordinary
Chinese. She rarely travels with the prime minister or appears with him, and there are few official photographs of the couple together. And while people who have worked with her say she has a taste for jade and fine diamonds, they say she usually dresses modestly, does not exude glamour and prefers to wield influence behind the scenes, much like the relatives of other senior leaders.
The State Department documents released by WikiLeaks included a suggestion that Mr.
Wen had once considered divorcing Ms. Zhang because she had exploited their relationship in her diamond trades. Taiwanese television reported in 2007 that Ms. Zhang had bought a pair of jade earrings worth about $275,000 at a
Beijing trade show, though the source — a Taiwanese trader — later backed off the claim and
Chinese government censors moved swiftly to block coverage of the subject in China, according to news reports at the time.
“Her business activities are known to everyone in the leadership,” said one banker who worked with relatives of Wen Jiabao. The banker said it was not unusual for her office to call upon businesspeople. “And if you get that call, how can you say no?”
Zhang Beili first gained influence in the
1990s, while working as a regulator at the Ministry of Geology. At the time, China’s jewelry market was still in its infancy.

While her husband was serving in China’s main leadership compound, known as Zhongnanhai, Ms. Zhang was setting industry standards in the jewelry and gem trade. She helped create the National Gemstone Testing Center in
Beijing, and the Shanghai Diamond Exchange, two of the industry’s most powerful institutions.
In a country where the state has long dominated the marketplace, jewelry regulators often decided which companies could set up diamondprocessing factories, and which would gain entry to the retail jewelry market. State regulators even formulated rules that required diamond sellers to buy certificates of authenticity for any diamond sold in China, from the government-run testing center in Beijing, which Ms. Zhang managed.
As a result, when executives from Cartier or De Beers visited China with hopes of selling diamonds and jewelry here, they often went to visit Ms. Zhang, who became known as China’s
“diamond queen.”
“She’s the most important person there,” said Gaetano Cavalieri, president of the World
Jewelry Confederation in Switzerland. “She was bridging relations between partners — Chinese and foreign partners.”
As early as 1992, people who worked with
Ms. Zhang said, she had begun to blur the line between government official and businesswoman. As head of the state-owned China Mineral and Gem Corporation, she began investing the state company’s money in start-ups. And by the time her husband was named vice premier, in
1998, she was busy setting up business ventures with friends and relatives.
The state company she ran invested in a group of affiliated diamond companies, according to public records. Many of them were run by Ms. Zhang’s relatives — or colleagues who had worked with her at the National Gemstone
Testing Center.
In 1993, for instance, the state company Ms.
Zhang ran helped found Beijing Diamond, a big jewelry retailer. A year later, one of her younger brothers, Zhang Jianming, and two of her government colleagues personally acquired 80 percent of the company, according to shareholder registers. Beijing Diamond invested in Shenzhen Diamond, which was controlled by her brother-in-law, Wen Jiahong, the prime minister’s younger brother.
Among the successful undertakings was

Sino-Diamond, a venture financed by the stateowned China Mineral and Gem Corporation, which she headed. The company had business ties with a state-owned company managed by another brother, Zhang Jiankun, who worked as an official in Jiaxing, Ms. Zhang’s hometown, in
Zhejiang Province.
In the summer of 1999, after securing agreements to import diamonds from Russia and
South Africa, Sino-Diamond went public, raising $50 million on the Shanghai Stock Exchange.
The offering netted Ms. Zhang’s family about $8 million, according to corporate filings.
Although she was never listed as a shareholder, former colleagues and business partners say Ms. Zhang’s early diamond partnerships were the nucleus of a larger portfolio of companies she would later help her family and colleagues gain a stake in.
The Times found no indication that Wen Jiabao used his political clout to influence the diamond companies his relatives invested in. But former business partners said that the family’s success in diamonds, and beyond, was often bolstered with financial backing from wealthy businessmen who sought to curry favor with the prime minister’s family.
“After Wen became prime minister, his wife sold off some of her diamond investments and moved into new things,” said a Chinese executive who did business with the family. He asked not to be named because of fear of government retaliation. Corporate records show that beginning in the late 1990s, a series of rich businessmen took turns buying up large stakes in the diamond companies, often from relatives of Mr.
Wen, and then helped them reinvest in other lucrative ventures, like real estate and finance.
According to corporate records and interviews, the businessmen often supplied accountants and office space to investment partnerships partly controlled by the relatives.
“When they formed companies,” said one businessman who set up a company with members of the Wen family, “Ms. Zhang stayed in the background. That’s how it worked.”

The Only Son
Late one evening early this year, the prime minister’s only son, Wen Yunsong, was in the cigar lounge at Xiu, an upscale bar and lounge at the Park Hyatt in Beijing. He was having

cocktails as Beijing’s nouveau riche gathered around, clutching designer bags and wearing expensive business suits, according to two guests who were present.
In China, the children of senior leaders are widely believed to be in a class of their own.
Known as “princelings,” they often hold Ivy
League degrees, get V.I.P. treatment, and are even offered preferred pricing on shares in hot stock offerings.
They are also known as people who can get things done in China’s heavily regulated marketplace, where the state controls access. And in recent years, few princelings have been as bold as the younger Mr. Wen, who goes by the
English name Winston and is about 40 years old.
A Times review of Winston Wen’s investments, and interviews with people who have known him for years, show that his deal-making has been extensive and lucrative, even by the standards of his princeling peers.
State-run giants like China Mobile have formed start-ups with him. In recent years,
Winston Wen has been in talks with Hollywood studios about a financing deal.
Concerned that China does not have an elite boarding school for Chinese students, he recently hired the headmasters of Choate and Hotchkiss in Connecticut to oversee the creation of a
$150 million private school now being built in the Beijing suburbs.
Winston Wen and his wife, moreover, have stakes in the technology industry and an electric company, as well as an indirect stake in
Union Mobile Pay, the government-backed online payment platform — all while living in the prime minister’s residence, in central Beijing, according to corporate records and people familiar with the family’s investments.
“He’s not shy about using his influence to get things done,” said one venture capitalist who regularly meets with Winston Wen.
The younger Mr. Wen declined to comment.
But in a telephone interview, his wife, Yang
Xiaomeng, said her husband had been unfairly criticized for his business dealings.
“Everything that has been written about him has been wrong,” she said. “He’s really not doing that much business anymore.”
Winston Wen was educated in Beijing and then earned an engineering degree from the
Beijing Institute of Technology. He went abroad

THE NEW YORK TIMES INTERNATIONAL FRIDAY, OCTOBER 26, 2012

The Wen Family Empire

KEY

Member of
Wen family

The family built a fortune by forming business networks aided by wealthy tycoons

Colleague of
Wen family
$1 million

Value of
Ping An stake
Business
relationship

A15

ØN

YANG ZHIYUN

Beginning with diamonds in the 1990s, the relatives of Wen Jiabao amassed a fortune by forming a complex business network that bought stakes in sectors as varied as real estate and telecommunications. Corporate records reviewed by The Times show that a tight-knit group of about 20 relatives and friends made investments that were sometimes aided by Asia’s wealthiest tycoons. By far the biggest source of the wealth came from investments in Ping An Insurance, China’s biggest financial services company.

MOTHER

Also known as Yang Xiu’an, the 90-year-old mother owned investments in
Ping An Insurance worth
$120 million.
$120 million

Blue type Operational company

WEN JIABAO
PRIME MINISTER OF CHINA

Gray type Shell company

Nicknamed Grandpa Wen because of his concern for the underprivileged, he has called official corruption a threat to the ruling Communist Party.

BROTHER

ZHANG BEILI

An expert in gems and a force in the nation’s diamond trade. She met
Wen Jiabao while both were working as government
WIFE
geologists in
Gansu Province.

WIFE’S BROTHER

WEN JIAHONG AND WIFE

He controls energy, engineering and waste treatment companies; his wife held a major stake in Ping An.
$110 million

SON’S WIFE

DAUGHTER

SON

ZHANG JIANMING

YANG XIAOMENG AND PARENTS

Invested in diamond companies with his sister's colleagues.

She holds shares in family-related companies, including a company that owns part of Union Mobile Pay. Her parents once held a big Ping An stake.
PRESIDENT

$416 million

BROTHER’S
COLLEAGUE

WEN YUNSONG

INVESTOR

ZHANG YUHONG

Hanyang
Investment

Vice president at Hanyang
Investment. Grew up in Tianjin.
Helps control investment firms tied to the Wen family.

VICE PRESIDENT

DIRECTOR

WEN RUCHUN

Holds engineering degrees, and an M.B.A. from Northwestern’s
Kellogg School of Business.
Co-founder of New Horizon
Capital. Chairman of China
Satellite Communications.

Worked at Credit
Suisse. Held shares of a Chinese jewelry company called
Gallop.

LEGAL
REPRESENTATIVE

SinoDiamond

WIFE’S BROTHER

INVESTOR

$176 million

CO-FOUNDER

C.E.O.

DIRECTOR

SON’S COLLEAGUE
LEGAL
REPRESENTATIVE
CO-FOUNDER

New
Horizon
Capital

ZHANG JIANKUN

Former government bureaucrat who invested in diamond companies backed by his sister, as well as real estate and highway infrastructure.

Sheng
Churui

$1 million*

C.E.O.

National
Trust

DIRECTOR
INVESTOR

YU JIANMING

Worked briefly at McKinsey in Los Angeles.
Co-founded the private equity firm New
Horizon Capital. Helps control a string of investment vehicles tied to the Wen family.

INVESTOR
DIRECTOR

LEGAL
REPRESENTATIVE

WIFE’S
COLLEAGUE

Go2Joy

DIRECTOR
INVESTOR

Union
Mobile Pay

INVESTOR
INVESTOR

WANG ZHUANGLI

Worked for a diamond company linked to Zhang Beili. A shareholder in several
Wen family-related companies, including Sheng Churui and Xuanda.

INVESTOR

$74 million

INVESTOR
INVESTOR
INVESTOR

DIRECTOR
INVESTOR

Xuanda

INVESTOR

Unihub
INVESTOR

Xinyuan
Liandong

Tianjin
Taihong

INVESTOR

INVESTOR

FORMED A JOINT VENTURE
WITH NEW WORLD CYBERBASE

OWNER

DUAN
WEIHONG
Beijing

CHENG
YU-TUNG
Hong Kong

$1.3 billion
One of China’s wealthiest women and the founder of
Taihong, the Great Ocean Group and Airport City Logistics. Her
Kaifeng Foundation gives to
Harvard University and Beijing’s
Tsinghua University.

Hong Kong’s second-richest man. Controls New World
Development, with real estate, infrastructure and retail business holdings, including the world’s biggest jewelry store chain, Chow Tai Fook.

ZHENG
JIANYUAN
Hong Kong

$14 billion

SOLD TO
DALIAN HAICHANG

LEGAL
REPRESENTATIVE

OWNER

QU
NAIJIE
Dalian

$1.4 billion*
Also known as Vincent Cheng.
A reclusive philanthropist and business associate of the Hong
Kong tycoon Cheng Yu-tung.
Once controlled three investment vehicles with 300 million shares in Ping An.

MERGED WITH
P.C.C.W.

LI
KA-SHING
Hong Kong

INVESTOR

SOLD TO A SUBSIDIARY
OF CHINA.COM

PETER
YIP
Hong Kong

$75 million
Wealthy businessman from northern China who controls
Dalian Haichang. Has interests in chemicals, plastics and diamonds. Forbes puts his net worth at $770 million.

The richest man in Hong Kong for much of the last decade, with a net worth of $22 billion.
Together with his son, Richard
Li, controls the Hong Kong conglomerate Hutchison
Whampoa.

The former chief executive of the
CDC Corporation, a Chinese technology company. One of his company’s major shareholders was New World Development, which is controlled by the Hong
Kong tycoon Cheng Yu-tung.

*Values of Ping An shares are figured as of January or October 2007 (latest records available), except where asterisked. Asterisked values are as of 2004. Shares attributed to Duan Weihong were owned through her mother. Those owned by Qu Naijie were through his company, Dalian Haichang. Those owned by Cheng Yu-tung and Zheng Jianyuan were through multiple investment vehicles.

GUILBERT GATES FOR THE NEW YORK TIMES

their family assets.
Whether Mr. Wen has made such disclosures for his own family is unclear, since the Communist Party does not re-

league of Wen Jiahong, the prime minister’s younger brother. The associates did not return telephone calls seeking comment. to-day operations and taken up a position at the China Satellite Communications Corporation, a state-owned company that has ties to the Chinese space

parties.
Established in Tianjin, Taihong had spectacular returns. In 2002, the company paid about $65 million to acquire a 3

relatives has been Cheng Yu-tung, who controls the Hong Kong conglomerate
New World Development and is one of the richest men in Asia, worth about $15

and earned a master’s degree in engineering materials from the University of Windsor, in
Canada, and an M.B.A. from the Kellogg School of Business at Northwestern University in
Evanston, Ill., just outside Chicago.
When he returned to China in 2000, he helped set up three successful technology companies in five years, according to people familiar with those deals. Two of them were sold to
Hong Kong businessmen, one to the family of Li
Ka-shing, one of the wealthiest men in Asia.
Winston Wen’s earliest venture, an Internet data services provider called Unihub Global, was founded in 2000 with $2 million in start-up capital, according to Hong Kong and Beijing corporate filings. Financing came from a tightknit group of relatives and his mother’s former colleagues from government and the diamond trade, as well as an associate of Cheng Yu-tung, patriarch of Hong Kong’s second-wealthiest family. The firm’s earliest customers were stateowned brokerage houses and Ping An, in which the Wen family has held a large financial stake.
He made an even bolder move in 2005, by pushing into private equity when he formed
New Horizon Capital with a group of Chineseborn classmates from Northwestern. The firm quickly raised $100 million from investors, including SBI Holdings, a division of the Japanese group SoftBank, and Temasek, the Singapore government investment fund.
Under Mr. Wen, New Horizon established itself as a leading private equity firm, investing in biotech, solar, wind and construction equipment makers. Since it began operations, the firm has returned about $430 million to investors, a fourfold profit, according to SBI Holdings.
“Their first fund was dynamite,” said Kathleen Ng, editor of Asia Private Equity Review, an industry publication in Hong Kong. “And that allowed them to raise a lot more money.”
Today, New Horizon has more than $2.5 billion under management.
Some of Winston Wen’s deal-making, though, has attracted unwanted attention for the prime minister.
In 2010, when New Horizon acquired a 9 percent stake in a company called Sihuan Pharmaceuticals just two months before its public offering, the Hong Kong Stock Exchange said the late-stage investment violated its rules and forced the firm to return the stake. Still, New

Horizon made a $46.5 million profit on the sale.
Soon after, New Horizon announced that
Winston Wen had handed over day-to-day operations and taken up a position at the China
Satellite Communications Corporation, a stateowned company that has ties to the Chinese space program. He has since been named chairman.

The Tycoons
In the late 1990s, Duan Weihong was managing an office building and several other properties in Tianjin, the prime minister’s hometown in northern China, through her property company, Taihong. She was in her 20s and had studied at the Nanjing University of Science and Technology.
Around 2002, Ms. Duan went into business with several relatives of Wen Jiabao, transforming her property company into an investment vehicle of the same name. The company helped make Ms. Duan very wealthy.
It is not known whether Ms. Duan, now 43, is related to the prime minister. In a series of interviews, she first said she did not know any members of the Wen family, but later described herself as a friend of the family and particularly close to Zhang Beili, the prime minister’s wife.
As happened to a handful of other Chinese entrepreneurs, Ms. Duan’s fortunes soared as she teamed up with the relatives and their network of friends and colleagues, though she described her relationship with them involving the shares in Ping An as existing on paper only and having no financial component.
Ms. Duan and other wealthy businesspeople — among them, six billionaires from across
China — have been instrumental in getting multimillion-dollar ventures off the ground and, at crucial times, helping members of the Wen family set up investment vehicles to profit from them, according to investment bankers who have worked with all parties.
Established in Tianjin, Taihong had spectacular returns. In 2002, the company paid about $65 million to acquire a 3 percent stake in
Ping An before its initial public offering, according to corporate records and Ms. Duan’s graduate school thesis. Five years later, those shares were worth $3.7 billion
The company’s Hong Kong affiliate, Great
Ocean, also run by Ms. Duan, later formed a

joint venture with the Beijing government and acquired a huge tract of land adjacent to Capital International Airport. Today, the site is home to a sprawling cargo and logistics center. Last year, Great Ocean sold its 53 percent stake in the project to a Singapore company for nearly
$400 million.
That deal and several other investments, in luxury hotels, Beijing villa developments and the Hong Kong-listed BBMG, one of China’s largest building materials companies, have been instrumental to Ms. Duan’s accumulation of riches, according to The Times’s review of corporate records.
The review also showed that over the past decade there have been nearly three dozen individual shareholders of Taihong, many of whom are either relatives of Wen Jiabao or former colleagues of his wife.
The other wealthy entrepreneurs who have worked with the prime minister’s relatives declined to comment for this article. Ms.
Duan strongly denied having financial ties to the prime minister or his relatives and said she was only trying to avoid publicity by listing others as owning Ping An shares. “The money
I invested in Ping An was completely my own,” said Ms. Duan, who has served as a member of the Ping An board of supervisors. “Everything
I did was legal.”
Another wealthy partner of the Wen relatives has been Cheng Yu-tung, who controls the
Hong Kong conglomerate New World Development and is one of the richest men in Asia, worth about $15 billion, according to Forbes.
In the 1990s, New World was seeking a foothold in mainland China for a sister company that specializes in high-end retail jewelry.
The retail chain, Chow Tai Fook, opened its first store in China in 1998.
Mr. Cheng and his associates invested in a diamond venture backed by the relatives of
Mr. Wen and co-invested with them in an array of corporate entities, including Sino-Life,
National Trust and Ping An, according to records and interviews with some of those involved. Those investments by Mr. Cheng are now worth at least $5 billion, according to the corporate filings. Chow Tai Fook, the jewelry chain, has also flourished. Today, China accounts for 60 percent of the chain’s $4.2 billion in annual revenue.

Mr. Cheng, 87, could not be reached for comment. Calls to New World Development were not returned.

Fallout for Premier
In the winter of 2007, just before he began his second term as prime minister, Wen Jiabao called for new measures to fight corruption, particularly among high-ranking officials.
“Leaders at all levels of government should take the lead in the antigraft drive,” he told a gathering of high-level party members in Beijing. “They should strictly ensure that their family members, friends and close subordinates do not abuse government influence.”
The speech was consistent with the prime minister’s earlier drive to toughen disclosure rules for public servants, and to require senior officials to reveal their family assets.
Whether Mr. Wen has made such disclosures for his own family is unclear, since the
Communist Party does not release such information. Even so, many of the holdings found by
The Times would not need to be disclosed under the rules since they are not held in the name of the prime minister’s immediate family — his wife, son and daughter.
Eighty percent of the $2.7 billion in assets identified in The Times’s investigation and verified by the outside auditors were held by, among others, the prime minister’s mother, his younger brother, two brothers-in-law, a sister-in-law, daughter-in-law and the parents of his son’s wife, none of whom is subject to party disclosure rules. The total value of the relatives’ stake in Ping An is based on calculations by The Times that were confirmed by the auditors. The total includes shares held by the relatives that were sold between 2004 and
2006, and the value of the remaining shares in late 2007, the last time the holdings were publicly disclosed.
Legal experts said that determining the precise value of holdings in China could be difficult because there might be undisclosed side agreements about the true beneficiaries.
“Complex corporate structures are not necessarily insidious,” said Curtis J. Milhaupt, a
Columbia University Law School professor who has studied China’s corporate group structures.
“But in a system like China’s, where corporate ownership and political power are closely in-

tertwined, shell companies magnify questions about who owns what and where the money came from.”
Among the investors in the Wen family ventures are longtime business associates, former colleagues and college classmates, including
Yu Jianming, who attended Northwestern with
Winston Wen, and Zhang Yuhong, a longtime colleague of Wen Jiahong, the prime minister’s younger brother. The associates did not return telephone calls seeking comment.
Revelations about the Wen family’s wealth could weaken him politically.
Next month, at the 18th Party Congress in
Beijing, the Communist Party is expected to announce a new generation of leaders. But the selection process has already been marred by one of the worst political scandals in decades, the downfall of Bo Xilai, the Chongqing party boss, who was vying for a top position.
In Beijing, Wen Jiabao is expected to step down as prime minister in March at the end of his second term. Political analysts say that even after leaving office he could remain a strong

backstage political force. But documents showing that his relatives amassed a fortune during his tenure could diminish his standing, the analysts said.
“This will affect whatever residual power
Wen has,” said Minxin Pei, an expert on Chinese leadership and a professor of government at Claremont McKenna College in California.
The prime minister’s supporters say he has not personally benefited from his extended family’s business dealings, and may not even be knowledgeable about the extent of them.
Last March, the prime minister hinted that he was at least aware of the persistent rumors about his relatives. During a nationally televised news conference in Beijing, he insisted that he had “never pursued personal gain” in public office.
“I have the courage to face the people and to face history,” he said in an emotional session.
“There are people who will appreciate what I have done, but there are also people who will criticize me. Ultimately, history will have the fin nal say.”