Chinese banks must increase transparency to fight corruption
Tighter regulations and greater transparency are needed if China’s banking system is to weed out corruption, following a recent spate of investigations linking senior executives with such charges. June 13, 2012 | Magessan RajAs one of the world’s fastest growing economies, corruption within China’s banks is of notable concern, especially since quite a few of the culprits have turned out to be very senior executives. Most recently, Postal Savings Bank president Tao Liming was taken in to “assist investigation into a personal economic problem,” with another bank official, Chen Hongqing, in charge of the bank’s capital operations, assisting investigations. There have been allegations that Tao was quizzed in relation to certain loans and transactions conducted, suggesting a possible violation of lending rules. Tao, who has served as the bank’s head since it was established in its current form in March 2007, has been put under “double designation,” an investigative procedure under which party officials are demanded to own up or explain one’s offences, with the designation usually followed by an intensive investigation, removal from position and a court trial. In a separate incident, though no less sensational, the head of Yantai Bank, Zhuang Yonghui, was taken into custody by the Central Commission for Discipline Inspection, the Communist Party’s anti-graft watchdog, and subsequently turned over to the police for criminal investigation as part of a wider graft inquiry. Zhuang’s case was uncovered after Liu Weining, former manager in one of the bank branches, was detained in February on suspicion of embezzling $67 million. Zhuang has come under close scrutiny after police received an anonymous tip-off suggesting he had embezzled funds to buy a stake in Yantai Bank before it invited foreign investors in 2008, pocketing $24 million in the deal. Upon further investigation, more than 35 staff members and managers were implicated in the scheme. While graft allegations within China’s banking system is not an entirely foreign concept, with the socialist state still serving the whims of those in positions of authority, it is heartening to see tha... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: China, Regulation, Risk and RegulationChina,riskregulation,Risk and Regulation, China,Regulation,Risk and Regulation, Keywords:Postal Savings Bank, Yantai Bank, ABC, Central Commission For Discipline Inspection, CBRC Postal Savings Bank, Yantai Bank, ABC, Central Commission for Discipline Inspection, CBRC
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