Being prosecuted on suspicion of six murders and other gang-related crimes: Liu Han.

Being prosecuted on suspicion of six murders and other gang-related crimes: Liu Han. Photo: AP

Beijing: A car drives up and screeches to a halt outside a quiet riverside teahouse. Gunmen emerge, shots ring out; three men drop to the floor, dead. The car speeds off, and in a matter of seconds, a gangland execution is complete.

It is this graphic narrative that sets the scene for what China's official state broadcaster described as the most "wicked" and "enormous" organised crime gangs to  rule the streets of Sichuan, a thriving province in the west of China.

At the centre is alleged billionaire kingpin Liu Han, whose company, Hanlong Group, was given the all-clear by the Foreign Investment Review Board to take over Australian iron ore miner Sundance Resources in 2012.

Liu Han as pictured on China's official state broadcaster CCTV on Thursday.

Liu Han as pictured on China's official state broadcaster CCTV on Thursday.

The fallout has been embarrassing for all concerned. A former Hanlong executive in Australia, Calvin Zhu, was found guilty of insider trading and sentenced to two years and three months in jail. Another executive facing insider trading charges, Steven Xiao, skipped bail and was arrested in Hong Kong last month.

Meanwhile, the $1.4 billion takeover offer  proved too good to be true. The deal collapsed in April last year after the funds Hanlong promised failed to materialise, with Liu's  financial backer China Development Bank pulling out.

The reasons for this are now becoming clear. Liu was detained in Beijing during the National People's Congress in March last year and had not been seen in public, prompting speculation he had been quietly executed.

Instead, after a 10-month investigation, 36 people including Liu and his brother Liu Wei are being prosecuted by the Xianning People's Procuratorate in Hubei Province on suspicion of six murders and other gang-related crimes.

The state broadcaster CCTV's news report, which aired on Thursday, made for riveting viewing.

Liu Wei, a prominent entrepreneur and philanthropist, pictured running in the Beijing Olympics torch relay, was actually an "organised crime boss that no one dared provoke", with extensive interests in gambling syndicates and loansharking, it was reported.

He ordered the shootings on that winter's day in 2009; one of the victims, Chen Fuwei, was an arch-rival that had threatened to kill him first.

It is then, the report alleges, that Liu Wei vanished, with his "vastly powerful brother who would stop at nothing" giving him "millions" of yuan and using his political influence to help harbour him.

A seized weapons cache of 20 firearms, 677 bullets and three "military-grade grenades" was flaunted on screen, as was the police's mock-up of the gang's organisational chart, with Liu Han sitting proudly on top.

Untouchable in his Sichuan stronghold, Liu Han's arrest in Beijing last March, during the Communist Party's most important annual set-piece political event, is significant for other reasons.

Liu is known to have close ties to Zhou Yongkang, the powerful former head of China's domestic security apparatus, who himself is in the crosshairs of President Xi Jinping's anti-corruption campaign. A 30-year veteran of China's state-owned oil monopoly, Zhou was also previously the party secretary of Sichuan.

"Liu Han could turn up to Zhou's house unannounced," one source with ties to the oil industry said. "He wouldn't even need to knock and he would be welcomed right in."

While there has been no official announcement of any investigation into the former Politburo Standing Committee member, Liu is only one of a growing tally of known Zhou associates to be toppled in the past year.

In the latest development, China announced on Tuesday it was investigating a former Zhou aide,  vice-governor of Hainan province Ji Wenlin, for alleged "serious violations of discipline", a Communist Party euphemism for corruption. By one count, Ji is the 18th senior official to fall as the net around Zhou tightens.

Significantly for a Chinese media regulated and controlled by the state, a report in The Beijing News clearly pointed out Ji's ties to his former boss and others ensnared in corruption investigations, including former Sichuan officials Guo Yongxiang and Li Chongxi, as well as former PetroChina executive Li Hualin.

The report also cited Jiang Jiemin, Wang Yongchun and Li Chuncheng, in the "high-level, systematic, network of corruption".

"What on earth have these people done? How much of China's national fortune have they embezzled, and who else is in this network?" the report, which spread widely online, said. "How has this huge corruption network been able to form and deliberately collude?

"Maybe, with deepening anti-corruption investigation in the future, the answers may surface one by one, and the public will gradually see all the truth."

with Sanghee Liu