The former Communist Party leader of Shanghai has been expelled from the party, state media reports.
Mr Chen was the most senior official to be sacked in a decade
Chen Liangyu was also sacked from all his government positions, according to state television.
He was fired last year after a probe into the alleged misuse of the city's pension fund. Many other senior figures were also accused of involvement.
Analysts say the latest move against Mr Chen could take him one step closer to standing trial on corruption charges.
The party has vowed to crack down on officials found guilty of corruption, which has become rampant since market reforms opened the economy in the 1980s.
State media said Mr Chen, the former party secretary in Shanghai, had been handed over to judicial authorities and that his case had made a "very negative impact" on the image of the Communist Party.
Mr Chen 60, was fired last September after a government investigation into the alleged misuse of at least one third of Shanghai's 10bn yuan ($1.2bn) pension fund.
1998: Beijing mayor Chen Xitong jailed for corruption
2000: Scores of officials implicated in smuggling scandal in Xiamen
2001: Mayor of Shenyang and his deputy sentenced to death for land deals
2007: Former head of the state food and drug agency sentenced to death for taking bribes
The money was said to have been used to make illegal loans and investments in real estate and other infrastructure deals.
Mr Chen was accused of seeking benefits for companies and relatives, and for protecting corrupt officials.
The case also led to the removal and detention of several other officials, including the city's social security and labour chief.
Mr Chen was the first member of the Politburo, the party's top leadership council, to be dismissed for corruption since 1995.
Following his dismissal last September, he did not turn up at Beijing in March for the annual session of parliament.