Dozens held over €681m Chinese bank fraud
Chinese authorities have arrested dozens of government officials and others accused in a scheme to steal 7.4 billion yuan (€681m) from a state bank through fraudulent loans.
Prosecutors intend to file charges against 69 people, including former employees of the Industrial and Commercial Bank of China, one of the country’s four main state-owned commercial banks.
The government has dismissed 80 officials accused of colluding in the scheme and some of them are among those being prosecuted.
China’s major state-owned banks are undergoing intensive audits in an effort to tighten their controls before they try to raise capital by selling shares on foreign stock exchanges.
According to investigators, the scheme at ICBC was led by businessman Feng Mingchang, who was found to have defrauded the bank’s branch in Foshan, a city in Guangdong province near Hong Kong, reports said.
Dozens of bank and government officials are accused of forging false letters of credit and proof of land and property in order for Feng to receive loans, they said.
More than 2 billion yuan (€184m) still has not been recovered, according to reports.
The case adds to a string of multi-million-dollar bank frauds uncovered at Chinese state banks in recent years.
The government announced in November that auditors had found fraudulent transactions at ICBC totalling 6.9 billion yuan (€635.6m) in 2000-2002. It wasn’t clear whether that report was related to the latest announcement of prosecutions.
