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Assets remain frozen in China graft case: Namibian court

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by Staff Writers
Windhoek (AFP) July 24, 2009
A Namibian court said Friday it will decide in two weeks whether to release the frozen assets of three suspects in a graft probe involving a firm linked to the son of China's President Hu Jintao.

The court said bank accounts and other assets of two Namibians and a Chinese national will remain frozen pending a decision on August 7.

The three were arrested last week in Namibia as part of a probe into bribery allegations involving Nuctech, a company headed until last year by Hu's 38-year-old son, Hu Haifeng.

During the hearing Friday, the defence for Nuctech representative Yang Fan and Nambians Teckla Lameck and Jerobeam Mokaxwa argued that the state had no evidence of corruption.

"There is no proof because people are simply interpreting contracts between Nuctech and the accused," defence lawyer Jeremy Gauntlett told the court.

The three were arrested after the southern African state's Anti-Corruption Commission (ACC) discovered that a 12.8 million US dollar down payment on 13 scanners had been diverted to a firm called Teko Trading.

Teko was acting as local agents for Nuctech, Gauntlett told the court in which the accused were not present.

They have been locked up since their arrest. Their bail request Wednesday was delayed to next week, after their lawyer requested more time to prepare for Friday's hearing.

Nuctech has a Namibian government contract to supply security scanning equipment in a 55.3 million US dollar deal, paid for with a Chinese loan granted when President Hu Jintao visited the country in 2007.

Hu's eldest son was the president of Nuctech until last year, when he was promoted to party secretary of Tsinghua Holdings, which controls Nuctech and over 20 other companies.

Between March and April, the 12.8 million dollar down payment was diverted to a firm called Teko Trading, equally owned by Lameck and Mokaxwa, investigators say.

All three accused later drew large sums from the Teko account, with Yang taking 16.8 million Namibia dollars (2.1 million US dollars), most of which he paid into an investment fund, investigators said.

Lameck and Mokaxwa allegedly spent large sums on expensive vehicles, farms and houses, according to investigators.

The graft case is one of two scandals linked to Chinese firms to rock Namibia this month, with local media linking the suspension this week of the country's defence force chief to possible kickbacks from a Chinese supplier.

China's Internet censors blocked news on the Nuctech case on Thursday, as state-run media ignored the sensitive issue which could prove embarrassing to Hu, who has publicly urged the Communist Party to rid itself of corruption.

The US-based China Digital Times, which monitors Web developments in China, said propaganda officials had issued an order banning various Internet searches related to the Nuctech case.

Xiao Qiang, who heads China Digital Times, said it was an "iron-clad" rule that negative information on top leaders and their families be kept from the public, but that such efforts often fuelled interest and the news leaked out.

"Censorship backfires on the censors much more in the Internet age," he said in an email to AFP.

China Digital Times and media watchdog Reporters Without Borders said it appeared the Nuctech Internet censorship had been in place for a few days.

China's mainstream media is more tightly controlled by the government, and newspapers as well as television news have also made no mention of the Nuctech case in recent days.

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