China to go after political backers of former mining magnate

Liu Han, the former chairman of Hanlong Mining, which attempted to take over Australia's Sundance Resources Ltd, led his gang on a crime spree for more than a decade, focused on China's southwestern province of Sichuan, state media have said.

The probe into Liu is one of the highest-profile cases against a private businessman since President Xi Jinping took power last year, vowing to battle corruption.

Liu would not have been able to get away with his crimes if he had not enjoyed the protection of "certain party, government and legal bodies", said the People's Daily, the official newspaper of the ruling Communist Party.

"As the case progresses, the umbrella of protection will be revealed to the public, and (they) will be severely punished by the law," it added.

"No matter who you are or what your position is, if you break the law you will be punished by the law."

Sichuan, where Liu's company, Hanlong Mining, is based, has been a focus of Xi's crackdown, mostly because it was a power base for Zhou Yongkang, the retired former domestic security tsar now being probed over graft.

Official media have not directly linked the case with Zhou, but have alluded to possible ties, as Liu's rise coincided with Zhou's time as Sichuan's Communist Party boss.

"Liu Han became widely connected to government officials in his search for an ever-more powerful 'umbrella'," said the official Xinhua news agency. "The news of the prosecutions has sent tremors through Sichuan's political and business circles."

The party has yet to make an announcement about Zhou's case. Sources have told Reuters he is effectively under house arrest.

Several of Zhou's men have been felled, including Jiang Jiemin, briefly top regulator of state-owned enterprises, and former Vice Minister of Public Security Li Dongsheng.

Reuters could not reach Hanlong for comment. It was also not possible to reach Liu, ranked as China's 230th richest person by the Shanghai-based Hurun 2012 Report, for comment.

Hanlong has a majority stake in Australian-listed iron ore miner Moly Mines and remains the biggest shareholder of Sundance Resources, although its proposed A$1.4-billion ($1.27 billion) takeover of Africa-focused Sundance was called off last April after Hanlong missed funding deadlines.

Liu founded Hanlong Group, a conglomerate in sectors from solar energy to real estate and infrastructure, in 1997.

(Reporting by Ben Blanchard; Editing by Clarence Fernandez)