News

Former chairman of prominent Chinese business newspaper sentenced to 4 years in extortion case

BEIJING, China – A former chairman of the company that publishes one of China’s most prominent business newspapers was sentenced to prison Thursday for coercing companies into paying to avoid negative coverage.

The announcement in September 2014 that executives of 21st Century Media Co. were accused of running a multimillion-dollar extortion racket highlighted accusations of rampant misconduct in China’s news industry.

The former chairman, Shen Hao, was convicted of extortion, “forced transactions” and embezzlement, the Shanghai Pudong New Area People’s Court said in a statement. He was sentenced to four years in prison and fined 60,000 yuan ($9,500).

21st Century Media was fined 9.5 million yuan ($1.5 million).

Earlier reports by state media said companies were coerced into paying about 300 million yuan ($50 million) for advertising and were threatened with negative news coverage if they refused.

News reports in April said prosecutors had authorized the arrest of 21 people, including the publisher and general manager of 21st Century Business Herald. No details have been released on the identities of the others or the status of their cases.

Authorities ordered 21st Century Media to close one of China’s most prominent business news websites, 21cbh.com, and a magazine, Money Weekly.

All newspapers, television and radio stations and other news media in China are owned by state entities or by the ruling Communist Party. But most are required to support themselves financially and are allowed to make editorial decisions within the party’s censorship guidelines.

Journalists routinely accept money from companies to report on events and sometimes seek payments to suppress negative information.

In a separate case, the director of state television’s financial news channel was accused last year of extracting money from companies, according to news reports. Companies paid to avoid negative news coverage or bought advertising or gave stock options for favourable exposure.