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Could China’s corruption crackdown extend to a Los Angeles suburb?

September 9, 2013
September 9, 2013

Walnut, California, a 25-minute commute from downtown Los Angeles, earned a spot on a recent listing of America’s best small towns for its parks, walking trails and rising home prices. The 30,000 population city might also soon become known, though, for links to the most extensive crackdown on corruption conducted in China in decades.

Zhang Shuguang, the founder of China’s high-speed railway who has been under investigation since February of 2011, has recently been accused of taking 47 million yuan ($7.7 million) in bribes, and will soon face trail for 13 charges of bribery. Some of that money may have been used to buy a five-bedroom, five bathroom, over 4,000 square foot home in Walnut, state-run media reported soon after the investigation against him was opened.

Two individuals with the same name as Zhang and his wife Xing Wang purchased the home in 2002, according to property website Blockshopper, for $860,000. The home is now worth $1.4 million, according to Trulia.

Zhang’s overseas assets have been the subject of much speculation in the Chinese-language private press. The state-run CCTV added fuel to that speculation with a report earlier this month on micro-blogging site Sino Weibo that Zhang had $2.8 billion in overseas accounts. The report was quickly deleted, but not before it was spotted by other media.

If Zhang and his wife are forced to sell their Walnut home, at least they can take comfort in the fact that the house has appreciated more than 60% since they owned it.

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