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Huang Guangyu: Gome Founder's Fall from Grace
A Mighty Fall
On May 18, 2010, Huang Guangyu3 (Guangyu), home appliances tycoon and founder of China-based Gome Electrical Appliances and Holdings Ltd. (Gome4 ), was sentenced to 14 years in prison on charges of insider trading, illegal operations, and bribing officials. It was a huge reversal of fortunes of Guangyu, who had once been the richest businessman in China. Guangyu's was a rags to riches story.... He started off in a small way, procuring electronic goods from Southern China at low prices and selling them in Beijing at a profit. He incorporated Gome in 1987. The rise of his business coincided with the economic boom in China. Soon Guangyu ventured outside Beijing and slowly spread his business across China.... |
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In 2004, Gome was listed on the Hong Kong Stock Exchange. In the same year, Guangyu featured on China's Rich List. By then, Gome had grown to become the largest consumer electronics retailer in the country5. In 2006, Guangyu's activities came under the scrutiny of Chinese authorities, who questioned him and his brother about the funding of their investments. They were cleared of charges but authorities continued to investigate their activities.
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