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NEWS: BUSINESS: Chinese Banks Suffer Hundreds of Million Dollars of Fraud.

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posted on Mar, 27 2005 @ 11:21 PM
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Chinese banks have been told by the countries bank regulator to increase measures to stop embezzlements and frauds on loans after the resignation of the chairman of one of China's largest government banks amid scandals and reports of corruption. The losses have cost hundreds of million dollars of lenders money due to frequent fraudulant cases and failues to detect employee fraud.
 



www.businessweek.com
"Leading management staff and those who are held responsible must be dealt with and punished," said the CBRC order, according to the official Xinhua News Agency.

Xinhua said the order included 13 instructions for banks to tighten management of their financial risks but gave no details.



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The US administration sent a Chinese national back to China last April amid controversy after his alledged involvment over theft of 485 million dollars and an employee of Bank of China was arrested recently in China after being a fugitive accused of embezzling 6 million dollars from his employers.

China would not be impressed at part of their system breaking down in front of international eyes. Employee theft is a huge issue worldwide but it will be looked at within the country with different eyes when the theft from your employer is the very government you live under. China is proud of her communism and closed regime and this warning to the banks to tighten up their security is not one the banks will take lightly and there could be more heads to fall over this issue over the next few weeks.



[edit on 27-3-2005 by Mayet]




posted on Mar, 28 2005 @ 03:18 AM
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Good, I feel much safer now investing in China. It's a great move that non only can attract additional foreign investments but also boost the image of Chinese banks. This is a step forward towards democracy where the rights of the account holders are reinforced and aligned with those of leading economies. This will also lead to stronger laws in order to enforce the repayment of loans and debts.



 
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