2011: Corrupt official exposed following railway disaster

2011: Corrupt official exposed following railway disaster

In July 2011, a train collision in Wenzhou (Zhejiang Province) killed 40 people and injured 192. Despite the government’s attempts to silence reporting on the incident, numerous Chinese media outlets, including Caixin, exposed how corruption played a major part in China’s Railways Ministry overlooking safety requirements during high-speed railway construction. The revelations drew the ire of China’s internet users. 

Months after the crash, Caixin further dug into the matter and revealed in this cover story that China’s high-speed rail system architect, Zhang Shuguang, had purchased a luxury mansion in the United States for about 860,000 USD in 2002, while his salary was only about 300 USD per month. It was later revealed that he had received bribes from contractors worth 8 million USD in the span of a decade. He was convicted to a death sentence later commuted to life in prison.

About Caixin

Caixin, which means “new fortune” in Chinese, is one of the few privately-funded Chinese media outlets. Founded by journalist Hu Shuli in 2010, it continues to publish critical investigative reports up to now. In 2021, following Caixin’s revelations on the government’s handling of the Covid-19 pandemic, the Cyberspace Administration of China removed it from its list of pre-approved websites, significantly curbing its reach and influence. Regardless, Caixin remains the world’s largest subscription-based media outlet outside of the United States and the United Kingdom with over 900,000 paid readers as of 2022.

“Zhang’s ups and downs”

By Ju Rong Qiang, Wang Chen and Zhang Tao

The Chinese homeowner at 688 Pierre Road in Walnut, California is a mystery to neighbours.

Starting from Los Angeles, drive about 35 miles along Highway 60, and you will find Walnut, where the middle and high-income class gather. Of the city’s more than 30,000 people, over 60 percent are Asian. Due to the winter drought, the California area is mostly barren grass and hills when viewed from the highway. After entering the city, it is full of spring, and many evergreen plants are planted in residential areas. The mansion bought by Los Angeles residents Zhang Shuguang and his wife Wang Xing is among them.

This villa covers an area of ​​nearly 30,000 square feet (approximately 2,793 square metres), with a living area of ​​4,100 square feet (approximately 381 square metres) and five bedrooms. Like other houses in the Pierre neighbourhood, this villa has a fence to separate the house from the road. The courtyard is surrounded by green trees, the lawn is neatly tended, and even the gate is decorated with Christmas snowflakes. Everything shows that the home is taken care of. Some Mexican workers weeding nearby said that they occasionally saw Chinese people driving in and out.

However, a Caixin reporter visited the place several times in December, but no one answered the door, and there was nothing in the mailbox. The phone number registered under the house owner’s name was out of service.

An American lady who lives next door told Caixin reporters that she has lived here for many years, but “barely knew there were people living next door.” She only met the male host once, and the hostess probably three or four times. She guessed that they were both Chinese people in their 40s and they never participated in community activities.

The mysterious owners of No. 688 are none other than Zhang Shuguang, who is known as the “chief architect of China’s high-speed rail,” and his wife Wang Xing. 

In mid-January 2011, not long after businesswoman Ding Shumiao in Jincheng, Shanxi Province was arrested, Zhang Shuguang rushed to the United States. He transferred the entire villa that he and Wang Xing shared to only Wang Xing’s name. Wang Xing closed her office in an upscale office building around the same time. This office was Room 308 of the building, which Wang Xing rented for at least ten years.

One month later, on February 28, it was announced that Zhang Shuguang had been suspended for investigation.

Rapid promotion journey 

As Liu Zhijun’s confidant, Zhang Shuguang focused on the negotiation and construction of high-speed rail. The Transportation Bureau itself is the core authority of the Ministry of Railways. He became a powerful figure in one fell swoop.

In November 2002, Zhang Shuguang and Wang Xing purchased the house with full payment. At that time, the documentary transfer tax alone cost 946 USD. Based on this calculation, Zhang and Wang spent about 860,000 USD to buy this villa (the Los Angeles County transfer tax rate is 1.1 USD for every 1,000 USD).

The school district where the villa is located has many schools with high teaching quality, such as Walnut Senior High School. There is also a famous university nearby, Pomona College of Arts and Sciences, so Chinese people favour it. Rosa, an agent who has practised nearby for more than 20 years, said that there are very few houses for sale in this neighbourhood, and the current market price can go lower than 1 million USD.

The 860,000 USD in 2002 was not a small amount. According to the exchange rate (1:8.28) of the year, it was equivalent to 7.12 million RMB. It is hard to imagine that a director of the Passenger Department of the Ministry of Railways earning more than 2,200 RMB a month can afford such a luxury house in the United States. Most of the home ownership in the United States can be attributed to his wife Wang Xing’s wealth (see the next article “Wang Xing, the middle person of train toilets” for details).

In 2002, Zhang Shuguang was at the bottom of his life. In 1998, he became the director of the Passenger Department of the Ministry of Railways, responsible for approving the passenger rails renewal plan of the local railway bureau and the train timetable for Beijing and Shanghai. However, because various parties did not speak of him highly, in 2001 he was assigned to the Shenyang Railway Bureau as the assistant director of the Shenyang Railway Bureau. Although it is a transfer at the same level, his authority was greatly reduced.

However, this was a short dormancy period. In March 2003, as Liu Zhijun took over as Minister of Railways, Zhang Shuguang quickly started his rapid promotion. In April 2003, Zhang Shuguang was transferred as the deputy director of the Beijing Railway Bureau and was promoted by half a grade.

In less than half a year, he was transferred back to the Ministry and served as the deputy director of the Equipment Department of the Ministry of Railways and the deputy director of the High-speed Office, responsible for the introduction of high-speed rail technology. In 2004, Zhang Shuguang was promoted to director and deputy chief engineer of the Transportation Bureau of the Ministry of Railways, and was later called “the first person in the design of high-speed rail.”

Zhang’s position is quite special. In terms of position, Zhang Shuguang was not a vice minister. But as Liu Zhijun’s confidant, he focused on the negotiation and construction of the high-speed rail introduction. The Transportation Bureau itself is the core authority of the Ministry of Railways, in charge of railway operation planning and development planning. Several factors add up.

Zhang was in the limelight for a while, and he became a formidable figure in the railway system. Afterwards, in 2007 and 2009, Zhang ran for the academician election with the rapid development of the high-speed railway. Although there was great support from all parties and the support team formed by the railway company, he was finally defeated by persistent opposition.

By 2011, taking advantage of the “4 trillion RMB” opportunity, the high-speed rail construction promoted by Liu and Zhang had been fully rolled out, becoming a “miracle” that shocked the world. For a while, even the Chinese website of the “Financial Times” was discussing when China would build the high-speed rail from Beijing to London. Under the increasingly prosperous scene, Zhang Shuguang already felt that he was riding a tiger.

In mid-January 2011, not long after Ding Shumiao was arrested, Zhang Shuguang sensed the danger and began to cut off related property relations. On February 28, Zhang Shuguang was suspended for investigation. A person close to Zhang Shuguang revealed that shortly after Zhang was taken away for investigation, “his hair became completely white, his back became hunched, and he also suffered from severe diabetes. His whole person is not what it used to be.”

During his suspension period, rumours about his corruption were rampant. The amount involved in the suspected case was 2 billion USD or more. However, these are all unconfirmed rumours. Judging from the initial knowledge of the Caixin reporter, what can be confirmed so far is Zhang Shuguang’s real estate in the United States and his wife Wang Xing’s manipulation of the train toilet market. According to insiders at the Ministry of Railways, Zhang is currently being held in Jinan, and the investigation into him has not yet concluded.

During the Caixin reporter’s interview, in the eyes of Zhang’s sympathisers and opponents, Zhang’s image was polarised. Opponents described him as an uneducated opportunist who was keen on flattery and fame. But in the field of railway locomotive construction, many people feel sorry for Zhang’s experience. On the one hand, they admire his working ability and affirm his contribution to the construction of high-speed rail.

Perhaps, both sides reflect the real Zhang Shuguang.

Fight into the Passenger Department 

No one expected Zhang to rise to a high position later.

Zhang Shuguang is 55 years old this year. His ancestral home is Liyang, Jiangsu. His father was an old Red Army soldier who participated in the Long March. When he was young, he moved to Xinjiang with his family because of his father’s job transfer. After graduating from Lanzhou Railway Institute (now Lanzhou Jiaotong University) with a major in vehicles in 1982, Zhang was assigned to work in the Bengbu depot of the Shanghai Railway Bureau Bengbu Branch.

According to a colleague of Zhang Shuguang, Zhang “started at the grassroots level and spent nearly ten years rising to be the deputy section chief of the Bengbu depot.” At the end of 1991, Zhang was transferred to the Inspection and Acceptance Office of the Locomotive and Rolling Stock Bureau of the Ministry of Railways as a management engineer. In this transfer, although the two positions are both at the department level, this step can be called a leap forward from the grassroots level to the ministry.

Zhang Shuguang is nearly 1.8 metres tall and has a handsome appearance. He and his wife Wang Xing both studied at Lanzhou Railway Institute. Wang Xing was born in 1960, four years younger than Zhang Shuguang.

“Although Wang Xing’s appearance is not amazing, his father was an ‘old man’ in the Ministry of Railways at the time, with a senior profile and many connections with people in the Ministry,” said Zhang Shuguang’s aforementioned colleague.

Wang Xing’s father, Wang Yaliang, worked in the Chinese Office of the International Union of Railways in Poland during the early 1980s. He served as the deputy director of the Foreign Affairs Bureau of the Ministry of Railways in the mid-1980s. At that time, the Ministry of Railways often went to Poland for meetings, and Wang Yaliang was in charge of reception.

According to another insider of the Ministry of Railways, when Zhang Shuguang first arrived at the Ministry of Railways, he found no place to settle down. It was not until the beginning of 1992 that the Vehicle Bureau established an Inspection and Acceptance Office. In the eyes of his colleagues, Zhang Shuguang at that time was “not impressive, but a very ordinary person,” and no one thought that Zhang would rise to a high position later.

Zhang Shuguang quickly got acquainted with the work in the ministry, and his next goal was the Passenger Department. In the early 1990s, the real power lay in the Passenger Department of the Vehicle Bureau, as the department was famous for its “wide connection and unwritten rules.”

Its first function is to compile the annual new passenger rail plan and distribute the manufacturing quotas for each factory among the locomotive manufacturing factories under the Ministry of Railways. The second function is responsible for approving the passenger rail renewal plan of the local railway bureau. Even Liu Zhijun had to “run the department” to ask for more quotas when he was the head of the Shenyang Bureau.

The previously mentioned insider of the Ministry of Railways recalled, “The local railway bureau needs new passenger carriages, but the allocation power lies in the hands of the director of the Passenger Department, so the Railway Bureau has to establish a relationship with the Passenger Department. Once the director of the Passenger Department went to Shenyang for a business trip, and Liu Zhijun picked him up in person and treated him with dinner. Liu Zhijun doesn’t drink much, but he had to drink six glasses of liquor with him, hoping that the Passenger Department would give 60 carriages to the Shenyang Bureau, but the director of the Passenger Department at the time ended up perfunctory.”

Additionally, the Passenger Department is also responsible for determining the time and frequency of trains bound for Beijing and Shanghai by the local railway bureau each year. At the same time, it reviews and approves scientific research projects and allocates funds for such research.

After working in the Inception and Acceptance Office for two years, in early 1994, Zhang Shuguang revealed privately that he wanted to be transferred to the Passenger Department. At that time, the leader of the Passenger Department agreed to “let Zhang Shuguang come and stay for three months as a trial.” At that time, there were five directors in the Passenger Department, and the deputy director position was always vacant. In 1994, Zhang Shuguang filled this vacancy and has since shown outstanding communication skills.

Owning his first luxury home

When Zhang Shuguang worked in the Passenger Department, he already had considerable wealth, which exceeded his normal income.

Before the reform of the Ministry of Railways’ subordinate organisation in 2001, the position of the Passenger Department was very important. It was one of the competent units of the locomotive factory and the local railway bureau, and it had a great say in the bidding of equipment and materials of the locomotive factory and the railway bureau. Therefore, for a large number of domestic small and medium-sized locomotive parts manufacturers, it is a shortcut to enter the railway market to directly obtain the approval of the Passenger Department of the Ministry of Railways.

“The passenger-carriage factory under the Ministry of Railways is only responsible for systematic integration, and many parts are provided by suppliers. If the supplier has a good relationship with the people in the Passenger Department, it can become a supplier designated by the Ministry of Railways. They can sell ​​the products at a high price,” said a retired person from the Ministry of Railways.

One of Zhang’s colleagues from the Passenger Department said, “Zhang Shuguang is good at communication, and he is very good at dealing with people.”

Zhang participated in much of its external communication and socialising. The Passenger Department is often involved in bidding for railway equipment and materials and exhibitions, which Zhang was willing to participate in–and sometimes required an honorarium of 50,000 RMB.

Before Zhang Shuguang was transferred to the bus department, many people had accidents due to bidding bribery. The previously mentioned colleague close to Zhang Shuguang revealed that when Zhang first arrived at the Passenger Department office, the director at the time also warned him to keep himself clean.

“Zhang also said at the time that there were a lot of people looking for him because of the bidding, and the door was blocked all day long, so he couldn’t go home for the whole day. He even promised to do fair business in the future,” the colleague said.

In 1998, Zhang was promoted to the director of the Passenger Division. But not long after Zhang arrived at the Passenger office, factory directors from all over the country privately reported that they felt “not very good” towards Zhang. This was due to him “asking for conditions and being offered benefits,” but they did not mention specific details.

During the period, there were rumours within the Ministry of Railways that someone reported that a locomotive refrigeration plant in Guangzhou wanted to enter the railway market and gave Zhang Shuguang 300,000 RMB.

The Caixin reporter learned from authoritative sources that Zhang’s criticism was only verbal at the time and did not receive any reports with any substantial evidence. The leaders of the Ministry and the Communist Party organisation decided to temporarily transfer Zhang Shuguang away in the name of “work in the grassroots” and to “stay away from bidding.”

In 2001, Zhang Shuguang was transferred to the Shenyang Railway Bureau as the assistant director. Regarding this decision, Liu Zhijun, who was the vice minister at the time, still had some opposition.

Did Zhang Shuguang have problems back then? At least according to the Caixin reporter’s investigation, Zhang Shuguang already had considerable wealth at that time, which exceeded his normal income. Zhang Shuguang’s wife, Wang Xing, has already gone to the United States to become the exclusive agent in China for a toilet manufacturer called Micropher. With her help, Macropher quickly entered the Chinese market and was once the leading brand of railway toilets before 2003.

As early as October 1999, Wang Xing purchased a 346,000 USD detached house in Los Angeles with a loan in her name. She transferred the house to co-ownership with Zhang Shuguang the following year. At the end of 2002, Wang Xing sold the house for 615,000 USD, and then she and Zhang Shuguang jointly bought the mansion No. 688 mentioned at the beginning of this article for about 860,000 USD.

Getting to Know Liu Zhijun

The key to Zhang Shuguang’s ability to become Liu Zhijun’s loyal confidant lies in his ability to implement his ideas well.

Many railway personnel who worked with Zhang Shuguang confirmed that Zhang Shuguang and the former Minister of Railways Liu Zhijun “have an extraordinary relationship and Zhang is Liu’s hard-core confidante.” Zhang Shuguang was promoted step by step later, thanks to Liu Zhijun’s vigorous promotion.

According to a retired person from the Ministry of Railways, Zhang Shuguang and Liu Zhijun had known each other since 1997. After Zhang Shuguang was transferred to the Passenger Department in 1998, the two became closer.

“At that time, Liu Zhijun was the deputy minister in charge of transportation of the Ministry of Railways. He was in charge of the speed-up test and needed the on-site cooperation of the people in the Passenger Department,” said the retired person.

Liu Zhijun is famous for “working hard”. “He is without question a workaholic. He often calls people to meetings at midnight and keeps them up until 3 o’clock in the morning,” said the previously mentioned retired person. They recalled that the director of the Passenger Department at that time was about to retire and couldn’t hold frequent late meetings in the middle of the night. “After several meetings, the director of the Passenger Department sent Zhang Shuguang to deal with Liu Zhijun.” Liu Zhijun started to notice Zhang Shuguang.

According to a person close to Zhang Shuguang, once Liu Zhijun called Zhang Shuguang in the middle of the night and asked him what he was doing. Zhang said he was dealing with an electrical failure, which left a deep impression on Liu Zhijun.

In October 1998, the former director of the Bus Division retired, and Zhang Shuguang was promoted to a higher level. He officially became the director of the Passenger Division of the Vehicle Bureau. From the descriptions of many people close to Zhang Shuguang, it can be seen that the key to his ability to become Liu Zhijun’s loyal confidant lies in his ability to implement Liu’s ideas and orders well.

“Liu Zhijun likes to stay up late, and Zhang Shuguang stays with Liu Zhijun at night. Zhang Shuguang can come up with solutions to Liu Zhijun’s questions. Liu Zhijun is a womaniser and Zhang Shuguang sets up women for him. Zhang and Liu are both very skilled at socialising. They get along very well.”

In March 2003, after Liu Zhijun became the new Minister of Railways, Zhang Shuguang’s promotion started to accelerate. Many people in the Ministry of Railways knew that Liu did not have a good rapport with the former minister Fu Zhihuan. Fu Zhihuan did not mention Liu Zhijun when he proposed the list of candidates, and the Central Assessment Team also raised different opinions when they came down for assessment.

“As soon as Liu Zhijun came to power, he cancelled the newly established passenger transportation company, which was a test field for the reform of the separation between the railway network and transportation business. He also adjusted the positions of many bureau-level officials promoted by Fu Zhihuan,” said an “old man” from the Ministry of Railways.

As the new broom sweeps clean, Liu Zhijun built up his own people network. According to the aforementioned retired person from the Ministry of Railways, after Liu Zhijun came to power, he directly selected people from the Ministry of Railways’ previous list of unsatisfactory personnel. Zhang Shuguang was on the list.

In April 2003, Zhang Shuguang was transferred from the Shenyang Railway Bureau to the Beijing Railway Bureau as the deputy director of the Beijing Railway Bureau. Less than half a year later, he was transferred back to the Ministry of Railways as the Deputy Director of the Equipment Department and Deputy Director of the High-speed Office of the Ministry of Railways, responsible for the introduction of high-speed rail technology.

Although Zhang was only the deputy director of the Highway Office, he held real power because of his relationship with Liu Zhijun. According to the usual practice, personnel in the railway system should work in the original post for at least one year before they can be promoted. However, as Zhang Shuguang had the ear of Liu Zhijun, he broke through the practice and was promoted three times in more than a year.

In 2004, Zhang Shuguang became the Director of the Transportation Bureau of the Ministry of Railways and deputy chief engineer, known as “the first person in China’s high-speed rail technology.”

High-speed rail expert

Zhang Shuguang is the first executor of Liu Zhijun’s leap-forward development strategy. The development of China’s high-speed rail in recent years has been deeply imprinted by Zhang Shuguang.

Since 2004, Zhang Shuguang’s main work revolved around high-speed rail. After Liu Zhijun came to power, he put aside the reform of the “separation of the railway network and transport business” that had been rolled out by his predecessor. Instead, he proposed to develop first and then reform.

The main task of the railway at this stage was to introduce foreign high-speed rail technology to realise the “leapfrog” development of the railway, as to solve the problem of insufficient railway capacity. Zhang Shuguang is the first executor of Liu Zhijun’s strategy. China’s high-speed rail development in recent years has been deeply imprinted by Zhang Shuguang.

Many people in the railway system, when interviewed by Caixin reporters, praised Zhang’s work spirit and ability. He was described as “very capable, quick in thinking, and very appealing in his speeches at meetings. He listened to the reports of the people below. He can quickly grasp the key points and problems.” He also worked very hard, “He often hold overnight meetings with his subordinates to study problems.”

A sales manager of Tangshan Company, which belongs to CNR Group, said that when the leaders came to inspect the work, they were most afraid of Zhang Shuguang, not Liu Zhijun. This was because Zhang was knowledgeable and could see problems at a glance. “Once he glanced over, we will lower our heads down.”

Under the leadership of Liu Zhijun, from 2004 to 2006, the Ministry of Railways successively carried out three important high-speed rail biddings, namely two joint venture biddings for bullet trains and Beijing-Tianjin intercity biddings. As the director of the Transportation Bureau, Zhang Shuguang was the dealer of the Ministry of Railways during the three bidding processes.

“In the negotiations back then, Zhang Shuguang was backed by the Chinese market. He appeared very professional and strong. Before the technology introduction negotiations started, he did a lot of market research and was very familiar with the product prices of foreign companies. As long as any foreign product wants to enter China, they must first cut the price by 30% based on the market price, otherwise, there will be no negotiation,” said an engineer from CSR.

In the opinion of a person who participated in the technical negotiations during those years, the negotiation strategy adopted by the Ministry of Railways is still worthy of appreciation today.

“The Ministry of Railways took the lead in the negotiations as all foreign companies need to directly negotiate with the ministry,” declared the negotiations participant. “Chinese corporates and markets are integrated, and if the Chinese side does not make concessions, the other parties have nothing to do. We let four foreign companies compete, and if one company fails, we will find another one. When the market is reformed by technology, the Ministry of Railways has done its best at that time.” 

In a promotional brochure issued by the Ministry of Railways, the story of Siemens’ 9 billion RMB bidding price being cut overnight has become Zhang Shuguang’s proudest work in the negotiation.

“Zhang is also a workaholic. He never writes scripts for speeches in meetings. People often report to him in meetings. He wears a pair of glasses and draws with a pencil. It is very professional. He sums it up in a few simple sentences with much clarity and instruction,” stated a manager of CNR.

“His words carry weight. He rarely praises manufacturers in public. Once he publicly praises a certain manufacturer, CNR and CSR will not dare to ignore this factory in the bidding and procurement. Later, after he became the director of the Bureau of Transportation, he was very powerful. It is difficult for manufacturers to contact him directly,” said a supplier.

From the perspective of railway insiders, it is Liu Zhijun’s strategy to develop the high-speed passenger-dedicated network at the fastest speed. Liu asked for policies and funding from the central government, and Zhang Shuguang is the one who implements them. The courage and audacity of the two are indeed beyond ordinary people’s reach. “In just five years, the mileage of railway operations has doubled, and the maximum speed is 350 kilometres per hour. This is unprecedented both at home and abroad.”

This kind of great leap forward has also brought great pressure on Zhang Shuguang. “In private, Zhang also said that he was under a lot of pressure and couldn’t sleep all night, lamenting that he had fallen too deep and it was hard to turn back,” confessed a person familiar with him.

In the opinion of many industry observers, the reason why the Ministry of Railways is now riddled with corruption and frequent safety problems is not the high-speed rail itself, but the system. Whether the high-speed rail should be built, how much should be built, and how and at what speed should be built are technical issues in themselves. However, the Ministry of Railways has no distinction between government and enterprises. Under Liu’s strong push, the high-speed rail has become fertile soil for corruption and security risks.

“The root cause is that the Ministry of Railways does not distinguish between government and enterprises. It is both the government and the enterprise. It formulates regulations and issues documents. Even when formulating regulations, it has already thought about how to resolve it if something goes wrong. It is difficult for the Ministry of Railways to give up this power, so there is a lack of motivation for reform,” asserted Zhao Jian, a professor at Northern Jiaotong University.

Applying for CAS fellowship 

In the 2009 competition for a fellowship of the Chinese Academy of Sciences (CAS), Zhang failed to get more than two-thirds of the votes, missing only one vote. Once again he suffered from great grievances. 

Zhang Shuguang began to apply for the CAS fellowship in 2007 but finally failed by one vote.

Why did the Director of the Transportation Bureau of the Ministry of Railways apply for such a fellowship? According to an insider, in addition to the fame and fortune brought by the fellowship, it also has a lot to do with Liu Zhijun. “Liu wanted to fight. But Liu himself was a worker, so he asked his subordinates to become CAS fellows,” said the insider.

After Liu Zhijun took office, to achieve “leapfrog” development as soon as possible, he terminated the ten-year domestic independent research and development of high-speed rail technology in China. This included the “China Star,” which was successfully developed by CSR and put into experimental passenger operation at that time. Instead, he turned to introducing foreign high-speed rail technology.

This move made Zhang Shuguang, who is responsible for the introduction of high-speed rail technology, many enemies in the industry. The previously mentioned insider declared, “Zhang Shuguang was supposed to apply for a fellowship of the Academy of Engineering, but the leader of the domestic EMU development project of CSR just happened to be working in the Academy of Engineering. Zhang worried that they would place difficulties in his application and take the lead in opposing him in the fellowship selection and voting, so he applied for the fellowship of the Academy of Sciences.”

But Zhang himself does not do academic research. In order to apply for a fellowship, in March 2007, Zhang mobilised the China Academy of Railway Sciences (hereinafter referred to as the Academy of Railway Sciences), CSR Sifang, Southwest Jiaotong University, Beijing Jiaotong University and other domestic scientific research institutions to write books and application materials for him.

“A domestic state-owned enterprise that acts as an import and export agent for the Ministry of Railways paid for food and lodging. Zhang started writing in March and spent two months writing it. He wrote three books in two months and finished the manuscript in May,” the insider said. “The publication date was changed to January 2007 when it was published. The reason why the publication date was brought forward is to prevent outsiders from thinking that these three books were written because of the fellowship application.”

“When he was in good times, a bunch of people surrounded him. Several engineers from CSR Sifang were his classmates at Lanzhou Jiaotong University, and they also helped him write papers and published monographs,” declared people from CSR Sifang.

According to the “Implementation Regulations for the Election of Fellowship of the Chinese Academy of Sciences,” fellow candidates are voted by the fellows of the department. “The number of fellows participating in the voting shall exceed half of the total number of fellows of the department, and the number of votes in favour shall not be less than one-third of the number of voters. The candidates will be selected in the order of the number of votes in accordance with the additional quota of the department until the quota is full.”

According to the previously mentioned sources, Zhang Shuguang received “very few” votes when he ran for the first time in 2007.

In 2009, Zhang Shuguang made a comeback. This time, Zhang reorganised people to publish three books and declared for the fellowship application of that year. According to a number of people in the railway industry, at that time, a company organised a team to canvas for Zhang Shuguang. They went to the judges one by one, including organising the selection experts to go on business trips to various places and visit the production activities of the high-speed train bases, with an introduction to the adoption result of foreign high-speed rail technology. “It’s all at public expense, and everyone was also given gifts.” The funds for scientific research projects in Zhang’s hands have also become a sharp weapon for him to canvass votes.

But this didn’t work out for everyone. According to a former colleague of Zhang Shuguang, “He was worried that the fellows of CSR would be in the way, so Liu Zhijun came forward, accompanied by several leaders of CSR, and invited the fellows of CSR to dinner, with a hope that there will be no objection for his application.”

Zhang Shuguang’s fraudulent behaviour was also reported. At that time, engineers from CSR Zhuzhou Plant and experts from the Academy of Railway Sciences reported Zhang Shuguang’s fraud to the Chinese Academy of Sciences, and the fellowship jury launched an investigation. According to the aforementioned informed sources, the locomotive manufacturing experts of the Academy of Railway Sciences were questioned at the time.

The Ministry of Railways put pressure on the Academy of Railway Sciences, hoping that people from the Vehicle Institute of the Academy of Railway Sciences would explain to the investigation team that Zhang’s application materials were true, and they were perfunctory in the end.

As a result, Zhang failed to get more than two-thirds of the votes in favour of the Chinese Academy of Sciences 2009 fellowship by one vote, and once again suffered from grievances.

He had no chance to do it again.

After Zhang Shuguang was arrested, an entrepreneur from Liyang, Jiangsu visited his parents in Beijing. His father still kept the habit of the Red Army’s Long March, wearing leggings and in good health. His mother was very sad because of Zhang Shuguang’s wrongdoings. For her, Zhang Shuguang was her pride. When people came from her hometown before, she liked to show people in her hometown a group photo of Zhang Shuguang and state leaders.

Now, both Zhang Shuguang and Liu Zhijun, the former Minister of Railways, are prisoners. In just one year, high-speed rail safety accidents have occurred frequently, and debt has gradually accumulated. The Ministry of Railways is facing an unprecedented predicament.

The recently obtained 200 billion RMB of funds can only relieve urgent needs, but cannot completely save the deteriorating railway finances with the arrival of the peak of railway debt repayment. Due to the lack of money, the pace of high-speed rail construction has to be slowed down again and again, and the railway reform that Liu Zhijun strongly opposed back then is on the way.

Caixin reporters Cao Haili, Duan Hongqing, Luo Jieqi, and New York correspondent Huo Kan also contributed to this article.