By staff reporters He Xin and Lu Yanzheng

　　Confident billionaire Li Qiang showed no sign of fatigue while seizing every opportunity to defend himself during a marathon trial recently in a Chongqing court, where he faced nine counts including charges that he ran a “triad-like” gang.

　　The 51-year-old, well-connected businessman – and two-term delegate to the local National People’s Congress – was among the most important, high-profile defendants to be hauled into court so far as part of an ongoing effort to quash gangsterism in this sprawling municipality of 28 million.

　　Li spent three months in jail before the six-day, 10-hour-a-day trial got under way in Chongqing’s Fifth Intermediate People’s Court. The hearings ended October 31, and a verdict is pending.

　　The trial shed light on what prosecutors say were profitable but illegal secrets to success for Li’s bus and taxi business. It also revealed what authorities call “triad-like characteristics” among local criminals, and gave officials a platform to repeat a long-standing legal position held by the government that triads simply do not exist in China, having vanished decades ago.

　　Li’s boldness in court reflected the confidence with which he allegedly conducted illegal business while competing against state-owned transportation companies. He argued that he was only following local “norms” for operating privately in Chongqing. He repeatedly complained to the chief judge about being deprived of his defense rights, and traded verbal fire with a prosecutor who asked him to “answer questions truthfully,” shooting back that he would do so “in compliance with the law.” He even mocked a low-level prosecutor in charge of taking trial notes, saying a government official accused of accepting bribes was “just a cleaning lady 10 years ago, like you.”

　　Li described his conflicts with “backbiting” state-owned competitors, saying he could never win. “Would you not chase me away if I took your place?” he asked one of the prosecutors rhetorically.

　　Yet Li also tried to play both sides. He addressed a judge as “lingdao,” which means leader, and apologized profusely for slips of the tongue. “I don't want to make you unhappy,” he told a judge. “What if you take revenge and pile more charges on me?”

　　But the charges had already piled up. Prosecutors have built cases against seven of Li’s relatives and 24 other alleged members of his allegedly triad-like group, charging them with pocketing 120 million yuan in illegal profits and evading more than 62 million yuan in taxes. Moreover, four of Li’s companies have been implicated.

　　Li’s trial was part of an ongoing crackdown which so far has led to charges against 80 people, including at least four top local government officials.

　　Courtroom Battle

　　The prosecution and defense built strong teams for the Li trial. His chief adversary was First Public Prosecutor Ran Jin, a senior official at the Chongqing Municipal Procuratorate with 20 years of experience. He also faced well-educated Second Public Prosecutor Wang Maogang.

　　Leading a 40-member defense corps was 75-year-old Zhao Changqing, a professor at the Southwest University of Political Science and Law and one of the authors of China’s 1997 Criminal Procedures Law.

　　The prosecution needed three days to build its case, introducing a 30,000-word indictment that took more than two hours to read, as well as 1,894 pieces of evidence and 240 file portfolios that filled six suitcases. Meanwhile, the defense focused on eight issues but took special aim at whether Li indeed committed triad-like crimes.

　　The idea that Chinese criminals form “groups with triad characteristics” first appeared in the 1997 revision that Zhao helped draft. Such groups, it said, harm or intimidate people in a defined area. The Supreme People’s Court issued a judicial interpretation in 2000, which was followed by a 2002 legislative interpretation by the National People’s Political Consultative Conference. These edicts said such groups have a criminal organization structure, economic resources, a strong tendency toward violence and control over a certain area or trade.

　　The prosecution tried to prove that Li and his followers met these qualifications, citing two incidents as particular examples of triad-like crime.

　　The first was a taxi driver strike in Chongqing in November 2008. According to the indictment, Li asked his deputy He Yonghong to call a meeting of managers at four taxi companies operating under Li’s Yuqiang Industrial (Group) Co. Ltd. He briefed them on news that taxis and city buses would halt operations collectively the next day, and that any taxis still on the road would be attacked. He then asked the managers to relay the news to all taxi owners that evening.

　　The next day, prosecutors said, Yuqiang’s taxi drivers stopped working while some owners and drivers attacked cabbies who failed to join the strike.

　　Later in the trial, however, prosecutors failed to introduce evidence to support the accusation that Li had helped organize the strike, effectively abandoning that charge.

　　The second incident used as evidence of triad activity involved an alleged quest by Li to form a transportation syndicate in November 2005. According to the indictment, the syndicate’s proposed charter said any directors prosecuted for criminal activity while carrying out corporate duties or board decisions would be paid 2 million yuan apiece by each of the other directors. But again, prosecutors failed to introduce relevant evidence.

　　Defense attorney Zhao said such a corporate charter would be impossible to create because it would never pass an official review, which is needed to win a business registration. Li argued that the wording merely came from a “brainstorming” session.

　　In conclusion, Zhao argued a lack of sufficient evidence for charges of triad-like activity. “Of these two incidents,” he said, “the first is no longer being talked about, and the other is a bit far-fetched.”

　　Bus Boss

　　Li’s transportation empire is legendary in Chongqing, a hilly city where one out of seven people uses public transportation every day. Before his arrest, Li controlled taxis and more than 100 bus and minibus routes – one-fourth of the city's total transportation network.

　　But he came from humble beginnings, first working as a cook at Southwest University of Political Science and Law and then joining the state-owned Chongqing Wooltops Factory, where he worked his way up to cargo fleet safety inspector.

　　When the factory restructured in 1992, then-34-year-old Li and his wife quit their jobs. He opened a short-haul minibus service with a partner in Banan District, south of downtown Chongqing. Business boomed, and four years later he started Yuqiang. Li gradually took control of some 20 companies.

　　He entered politics in 2002, winning a five-year-term as a Chongqing NPC delegate. After being re-elected in 2007, Li wrote a negative report about financial and operational problems at public transportation firms, sending it to municipal government leaders.

　　Li also served as the Banan District’s political adviser and as a director for several official and semi-official associations, including the Chongqing Chamber of Commerce.

　　Li is considered eloquent, charming and generous. He is known for often sending gifts of meat and cigarettes to government officials, and handing “hongbao” cash gifts to local reporters and scholars. He also donated money to a leukemia fund and treated all his group’s drivers and vehicle owners to a big banquet each New Year’s Eve.

　　Li managed with a patriarchal style. He holds 60 percent of his group’s stock and employs relatives as executive deputy managers, accountants and cashiers.

　　At the trial, he tried to shield others accused along with him, trying to take the blame for what they allegedly did. “I was in charge,” he told the court. “Who else?”

　　Competitive Spirit

　　As his business prospered, Li was not afraid to face off against state-subsidized public transportation firms. This sort of competition dated to the early 1980s, when private firms introduced a popular hail-and-halt minibus service to compete against public electric buses. The new service became such a hit that state-owned companies put their own minibuses on the road.

　　In February 2006, Li sued the Chongqing Municipal Transport Administration for setting what he called “prejudiced” rating standards that put private firms at a disadvantage in contract bidding for an inter-province transportation project. Private firms had lost the bids.

　　And apparently Li’s private group was not on the list for consolidation with public transportation firms after a poor image of minibus drivers prompted the government to intervene in 2007 and force private and public firms to consolidate.

　　New Year’s dinners aside, prosecutors say Li tried to seize a larger market share by means of violence, currying favor with authorities and mass protests. The indictment cited a fight over a popular route that pitted Yuqiang and a public transport company nine years ago.

　　The competitor allegedly smashed and detained Yuqiang vehicles that were running without proper licenses. In revenge, prosecutors said, Li told his people to stop the competitor’s vehicles and puncture tires. Later, some Yuqiang vehicle owners and their families gathered at the municipal government building. Eventually, Yuqiang won government permission for an additional 11 vehicles in its fleet.

　　These events – although they happened nine years ago -- led to several of the criminal charges against Li, including disrupting administrative order and disturbing the peace while organizing and participating in triad-related activities.

　　Li dismissed the accusations, claiming he was just following norms. Under some norms, he said, transportation firms are not obliged to pay income taxes. Moreover, Li told the court that his state-owned competitor initiated the 2000 attack.

　　Another so-called norm among authorities and companies, Li claimed, concerns “right of way” rules. It says a company that begins a route should be allowed to run it later, if other companies don’t object. Even if they do object, the government is supposed to take a balanced approach in distributing operation quotas.

　　Government Reforms

　　Aware of problems with so-called norms, the government rolled out a basket of reform plans in October 2006. One called for a franchise mechanism through which public transportation route operators would be chosen via public tender. But these routes have turned out to be few and far between.

　　Another plan called for separating depot facility construction and transportation services, while setting up depot service companies. But for now, after private companies finance and build passenger stops, some builders monopolize the depots and prevent other companies from picking up passengers in the vicinity.

　　Conflicts have ensued, and Yuqiang workers were accused of resorting to violence. Prosecutors cited eight such incidents around a depot at Chengjiaqiao financed by Yuqiang. Li said these depots had been approved by transportation, construction and police authorities – a claim prosecutors supported, saying he won approvals through bribery.

　　The indictment said Li “wooed government employees for illegal protection, infiltrated political and economic circles step-by-step, and eventually established a strong position in Chongqing’s passenger transportation market.”

　　And Li was apparently bold about his maneuvering. Whenever he tried to control a government official, he purposely left behind evidence of a bribe or tape-recorded the transaction so he could tighten the noose later.

　　Prosecutors have been happy to pull the rope: So far, four officials have been accused of taking bribes from Li, including Jiang Hong, director of the Banan District Transport Administration; Xiao Qinglong, director of the Chongqing Shapingba District Transport Administration; Jiang Chunyan, director of the No. 2 petition department at the Chongqing government; and Zeng Andong, inspection chief at the local tax bureau.

　　Crackdown Continues

　　Each defendant tied to the ongoing gangster trials, including Li’s, has shared a common concern: None wanted to be accused of triad-related activity, even if they decided to admit to crime.

　　Ran, the public prosecutor, trod the official line about triads, telling the media the crackdown took aim at groups with triad characteristics – not triads.

　　And at a press briefing October 29, Chief Justice Qian Feng of the Chongqing High People’s Court called it “normal” for a suspect to deny triad activity. Qian said the defendants’ pleas were proof that the right of expression and defense for each suspect has been “fully guaranteed” by the judiciary.

　　But outside the courtroom, some argued that the gangster strategies allegedly used by Li to climb economic, social and political ladders reflected inherent weakness in China’s private sector and a lack of proper supervision.

　　One private transportation business owner said he thinks the current situation requires each and every private business to “keep some people to coordinate relations and handle circumstances.”

　　1 yuan = 14 U.S. cents