China to try Western couple as part of probe into alleged corruption at GlaxoSmithKline


GlaxoSmithKline, target of a bribery probe in China, said some executives may have broken the law, while rival drug maker AstraZeneca said police are investigating one of its sales representatives. (Eugene Hoshiko/AP)

— A British investigator and his Chinese American wife face trial in China on Friday after being swept up in a massive probe into possible corruption at British drugmaker GlaxoSmithKline.

Former journalist Peter Humphrey, 57, and his 60-year-old wife, Yu Yingzeng, who was born in China but later took American citizenship, were jailed in July 2013 for allegedly obtaining private information illegally.

They made public confessions on Chinese state television on two occasions, and family and friends say they are expected to plead guilty when the trial begins in Shanghai but are hoping for lenience from the judge.

Neither is accused of involvement in the GSK scandal, which is alleged to have involved the funneling of hundreds of millions of dollars in bribes to doctors to prescribe the company’s drugs. Instead, they have been caught up in an extraordinary drama of alleged corruption, betrayal, sex and political intrigue — collateral victims of a controversy that has sent shockwaves through the business world here.

Hired to investigate the background of a suspected whistleblower within GSK, the two say that they took at face value the company’s assertions that the bribery allegations were false and that they would not have taken the case if they had believed them to be true. Family and friends say Humphrey and Yu now feel disillusioned with a company that they say has not provided them any financial or legal support since their arrest.

“GSK said the bribery allegations were not true, but if they had admitted them, my dad would have handled it differently,” the couple’s 19-year-old son, Harvey Humphrey, said in a telephone interview.

Peter Humphrey’s company, ChinaWhys, was commissioned by GSK in April 2013 to investigate Vivian Shi, a Chinese former employee originally hired for her high-level contacts within the Communist Party. But the contract has since placed the investigators on what appears to be the losing side of a high-stakes political battle.

Shi was forced out of GSK in late 2012 under a cloud, after being accused of irregularities in her expense claims. But what is more significant, the company also came to suspect her of having reported it to the authorities for widespread corruption and of having e-mailed to the board a sex video involving the British head of GSK’s China division, Mark Reilly, and his Chinese girlfriend, recorded covertly in his apartment. The company wanted Humphrey and his wife to find out whether its suspicions were correct.

In its report on Shi, titled “Project Scorpion” and obtained by The Washington Post, ChinaWhys says GSK had conducted internal investigations into the corruption allegations “but could not substantiate them.” Indeed,in his second televised confession in July, Humphrey said he had asked GSK for permission to investigate whether the allegations were true, “but they refused me.”

But the report of the husband-and-wife team of investigators can hardly have endeared them to Shi or to her Communist Party friends.

“Our findings lead us to conclude that Vivian was both capable of and responsible for the smear campaign against GSK and Dr. Reilly and that she has a past track record of staging similar attacks,” the ChinaWhys report alleged. “But we have also found her to have powerful political contacts, especially in the pharmaceutical sector.”

Writing to Britain’s Daily Telegraph newspaper, Shi has categorically denied she was the whistleblower.

For its part, GSK said in July that its internal investigation “did not find evidence to substantiate the specific allegations made in the whistleblower emails,” although it said that some employees were dismissed for “fraudulent behavior relating to expense claims.”

“We have zero tolerance for any kind of corruption in our business, and we have many policies, procedures and controls in place to monitor this and take action against any breaches,” it said.

GSK’s China boss Reilly, a 52-year-old British father of two who is separated from his wife, returned to China last year in an attempt to clear his name after the allegations were made public but was subsequently detained. In May, he was accused of having presided over a “massive bribery network.” If found guilty, he could face stiff punishment: Not-guilty verdicts are rare in China’s Communist-choreographed court system, and his prospects look bleak, experts say.

In contrast, Humphrey and Yu’s family and friends hope that their willingness to cooperate with the Chinese authorities, as well as their readiness to distance themselves from GSK, will work in their favor. Authorities originally said their trial would be closed-door but later relented, and they also allowed the couple’s son to visit them for the first time last Friday.

Both are in “mediocre” health, Harvey Humphrey said, with his father suffering from a hernia and arthritis, and his mother operating on only one functioning kidney. “But it doesn’t look like their health is getting worse, which is a positive,” he said.

Peter Humphrey spent many years as a journalist for the South China Morning Post and the Reuters news agency. In an emotional letter to his son written from prison, he said he had always believed strongly in the idea of public service and had started his consultancy only to help “distressed companies and individuals who were the victims of crime.”

Xu Jing and Gu Jinglu contributed to this report.

Simon Denyer is The Post’s bureau chief in China. He served previously as bureau chief in India and as a Reuters bureau chief in Washington, India and Pakistan.

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