BEIJING—China’s former chief insurance regulator confessed in court to charges he took bribes worth $3 million, paving the way for the sentencing of an official whose downfall symbolized Beijing’s battle against financial risk.
During a one-day public trial Thursday, prosecutors accused
of abusing his power and accepting money and gifts worth 19.42 million yuan both directly and indirectly over 12 years as a financial sector official, until his removal as head of the insurance regulator in April of last year, state-run Xinhua News Agency reported.
Xinhua said Mr. Xiang pleaded guilty. A photograph accompanying the report showed the 61-year-old standing in the defendants box and reading from papers. Mr. Xiang hasn’t commented publicly or through a lawyer since he was detained 14 months ago and couldn’t be reached for comment. In the Chinese justice system, defendants are expected to confess to receive more lenient sentencing.
His removal as chairman of the China Insurance Regulatory Commission came at the start of a government effort to root out risky lending that was feeding debt and corruption. His removal was meant to underscore Beijing’s resolve.
During his six years as chief insurance regulator, the sector expanded rapidly, tapping online channels to boost sales. Insurers like Anbang Insurance Group Co. began offering short-term, high-yield investment products to retail investors, while plowing the proceeds into less-liquid assets, such as property.
As the insurance sector swelled, so did the debt levels of companies and local governments. With the money of ordinary investors at risk, Beijing began to rein in the sector, ordering insurers to return to providing basic coverage for policyholders and sending in investigators already targeting corrupt officials and economic crimes.
Shortly after Mr. Xiang’s removal, authorities detained Anbang chairman Wu Xiaohui. Mr. Wu was sentenced to 18 years in prison last month, and Anbang is now operating under direct government supervision.
China’s insurance regulator was folded into the banking regulatory commission earlier this year as part of Beijing’s efforts to streamline oversight of financial institutions.
In April, prosecutors indicted Mr. Xiang, accusing him of accepting bribes while he was a vice president at China’s central bank, an executive and Communist Party secretary at state-owned
and chairman of the insurance regulator.
The court will deliver a judgement for Mr. Xiang at a later unspecified date, according to Xinhua.
—Grace Zhu contributed to this article.
Write to Chao Deng at [email protected]