As China Official Rose, His Family's Wealth Grew - New York Times

DALIAN, China â€" Just a few weeks before his dramatic fall from power, Bo Xilai wrote an inscription in calligraphy, praising the Chongqing Water Assets Management Company, and urging support for its operations.

What he did not say was that a foundation controlled by his younger brother, Bo Xicheng, had acquired a stake in a subsidiary of the water company.

Mr. Bo had done something similar in 2003, while serving as governor here in Liaoning Province. He said his province would make supporting the Dalian Daxian company, a conglomerate engaged primarily in electronics manufacturing, one of the most important tasks of the next five years. A few years earlier, another company controlled by the same younger brother was listed as the owner of nearly a million shares in Dalian Daxian, worth about $1.2 million.

It is not clear whether Mr. Bo knew of the indirect stakes in the companies, or whether his brother profited from his pronouncements. But now, in the aftermath of Mr. Bo’s dismissal, on suspicions of corruption and accusations that his wife arranged the killing of a British business associate, there are mounting questions about whether Mr. Bo, who was most recently the party chief in the city of Chongqing and a member of the Politburo, used his enormous political clout to enrich himself and his closest relatives.

For much of the last decade, while Bo Xilai was busy moving up the ranks of the Communist Party, his relatives were quietly amassing a fortune estimated at more than $160 million. His elder brother accumulated millions of dollars’ worth of shares in one of the country’s biggest state-owned conglomerates. His sister-in-law owns a significant stake in a printing company she started that was recently valued at $400 million. And even Mr. Bo’s 24-year-old son, now studying at Harvard, got into business in 2010, registering a technology company with $320,000 in start-up capital.

Bo Xilai’s downfall this spring has also cast a sharper spotlight on the hidden wealth and power accumulated by the Communist Party’s revolutionary families, and by the sons, daughters, wives and close relatives of the nation’s high-ranking leaders.

“This could really open a can of worms,” says Bo Zhiyue, a senior fellow at the National University of Singapore’s East Asian Institute. “The relatives of other party leaders are also doing lots of business deals, and people will begin to ask: What about them? Was the Bo family the only one doing this kind of thing?”

Mr. Bo was suspended from his Politburo position and his leadership of Chongqing, a large metropolis with province status, in recent weeks amid accusations that, among other things, he interfered with an investigation into the death of a Neil Heywood, a British businessman whose body was found in a Chongqing hotel room on Nov. 15. His death was initially attributed to alcohol poisoning. Mr. Bo’s wife, Gu Kailai, and Zhang Xiaojun, the family’s 32-year-old “orderly,” were named as the main suspects, with officials saying Ms. Gu and her son, Bo Guagua, had had a dispute with Mr. Heywood over “economic interests.”

The case has also raised questions about how the Bo family was able to afford to send their only son to study in England at Harrow and Oxford University, as well as now at Harvard, for graduate school.

State-run media reports have hinted at the possibility that the Bo family had been transferring illicit assets overseas. And soon after Mr. Bo was dismissed from his posts, Xu Ming, one of China’s wealthiest businessmen, with close ties to Mr. Bo and his family, was detained, possibly here in the city of Dalian, where Mr. Bo had once served as mayor.

None of the extended family members have been accused of illegality. But the circumstances surrounding Mr. Bo’s actions in support of companies where family members had an interest suggest that he may have used his influence to help increase their wealth.

Corporate records in Hong Kong and China show that the siblings of both Mr. Bo, who also served as commerce minister in the national government, and his wife have been exceptionally active for years in forming investment companies and setting up offshore entities. Moreover, sometimes Mr. Bo’s family members have held their stakes using an alias.

Two of Ms. Gu’s sisters â€" Gu Wangjiang and Gu Wangning â€" have earned millions of dollars in publishing, real estate and other ventures. Together they own about $120 million worth of shares in the TungKong Security Printing Company in eastern China. The TungKong Web site says the company has contracts with some of China’s biggest state-owned enterprises and government agencies, including the tax authorities and the Central Bank.

Gu Wangning also helped Bo Guagua establish a technology company in Beijing in 2010. The Guagua Technology Company’s supervisor is listed as Mr. Zhang, the Bo family aide accused along with Ms. Gu of being involved in Mr. Heywood’s death.

Keith Bradsher contributed reporting from Hong Kong. Xu Yan contributed research from Shanghai.