China publishes gallery of alleged financial fugitives

FCA china-financial-fugitives

China’s Ministry of Public Security has released information about economic fugitives (pictured) who were believed to be at large in other countries, including Australia. China Ministry of Public Security

The Communist Part of China’s crackdown on corrupt officials has created a wave of economic fugitives, who are fleeing China to escape trial. The Ministry of Public issued the photos above of alleged economic fugitives from China, many of whom are thought to be in Australia.

The Chinese diaspora is widespread. Since President Xi Jinping began his campaign to root out corruption from the Chinese Communist Party, stories of alleged financial criminals fleeing China to live with relatives in other countries have cropped up in the media. Last year, the focus was the US, thought to be a safe haven from extradition. Now the focus is Australia, another country which has an extradition treaty with China, but which has yet to ratify it.

In March this year, China reportedly gave the US a list of allegedly corrupt officials, thought to be in the US and asked for help in tracking them down. The Chinese government launched Operation Foxhunt  in summer 2014, in a bid to track down suspects on-the-run beyond China’s borders.

Back in February 2014, Financial Crime Asia reported on the expected surge of fugitives to Australia. Canada had apparently been the migrant’s destination of choice, until it scrapped an investment immigration programme for Chinese citizens after noticing a marked increase in the number of applications by wealthy Chinese Mainlanders.

In 2013, China’s anti-corruption body, the Central Commission for Discipline Inspection, investigated 51,000 people for corruption, bribery, embezzlement and abuse of power. It claimed a total of 30,420 officials were punished for violating new party rules aimed at avoiding pomp and ceremony, according to a report in the Sydney Morning Herald.

How to spot an economic fugitive

Government officials are politically exposed persons and, thereby, subject to enhanced due diligence measures by banks and other regulated institutions in Australia, Canada and other jurisdictions. Whether the alleged criminals will be subject to extradition or not for the crimes they may or may not have committed, their inclusion on the ‘wanted list’ is enough to merit further enquiries by financial institutions.  The photo gallery above presumably gives the names of the officials in Pinyin. Any list monitoring software worth its salt will be able to translate the names into the Latin alphabet and should be able to identify whether any of the names above correspond to accounts held at a financial institution.



China’s corruption probe affects Canadian oil reserves

The FCPA and UKBA may have extra-territorial reach built into their statutes, but clauses are not stopping the long arm of the Chinese legal system from disrupting industry beyond its borders. FCA - oilsands

Reporters from the WSJ have reviewed emails detailing a shake up at the top of China National Petroleum Company‘s (CNPC) Canadian operations and a billion-dollar oil sands project is on the blocks as a result. Canadian officials have commented that “there is no reason to believe that any Canadians are involved or being investigated.”

GSK scandal triggers debate on high drug prices in China

The bribery scandal involving British pharmaceutical giant GlaxoSmithKline’s Chinese subsidiary GlaxoSmithKline (China) Investment (GKSCI) first came to light 11 months ago.

GSK China's office building in Shanghai. (Photo/Xinhua)

GSK China’s office building in Shanghai. (Photo/Xinhua)

The police found that the British drugmaker offered bribes to boost sales and inflated drug prices to make up for the bribery expenses and help the firm earn huge profits.

Among the irregularities cited was the domestic price of Heptodin — a drug used to fight hepatitis — being quoted as seven times higher than what was being charged in some countries.

Heptodin was being sold for 142 yuan (US$22.76) in China, compared with only 18 yuan (US$2.87) in South Korea, less than 26 yuan (US$4.17) in Canada and less than 30 yuan (US$4.8) in the United Kingdom.

The news agency added that this meant that Chinese patients had to pay much more to buy a box of Heptodin and that “the price of the drug sold in China could be seven times higher than in other countries.”

But the price gap was not valid, as this comparison involved comparing the price of a box of Heptodin in China with a tablet overseas.

Although the error was quickly pointed out by the media and other websites, GSK made no further clarifications on the price differences. But the controversy surrounding the case has triggered a hot debate about the prohibitive high prices enjoyed by the original drugs of the multinational pharmaceutical companies.

“Although the basis for calculation in GSK’s case was wrong, it is a fact that the British company has violated the law,” an insider from the Pharmaceutical Industry Association stated, adding that “maybe we could use the case to solve the long-stalled issue of allowing original drugs to set their own prices.”

The original drugs refer to imported drugs that have passed the patent protection period, but still enjoy the unique treatment of setting their own prices so that price differentials between the original drugs can be more than 10 times that of domestic generic drugs.

“There is no such a thing as original drugs in the international community; there are only patent drugs and generic drugs. Patent drugs enjoy high prices and market status for a short period of time, but after that period, there will be generic drugs. Only in China, these multinational companies continue to set high prices after the patent protection period and enjoy higher than national treatment,” Yu Mingde, president of the China Pharmaceutical Enterprises Association, pointed out.

Yu has been dedicated to the scrapping of such treatment for years. Some are also of the view that this is one of the major factors for high drug prices in China.

Source: WantChinaTimes

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Sanctions: How weighty are sanctions threats against Russia?

The Canadian press is reporting stories that the government is prepared to place sanctions against Russia if it gets involved in the Ukraine fall out. But what could Canada effectively threaten Vladimir Putin’s country with?

Russia under Putin has taken steps in the past ten years to extricate itself from foreign agreements. Russia is proud not to need aid and alms from other jurisdictions; foreign non-governmental organisations were required to register with the police a few years FCA - PutinPuppyago or face expulsion. In 2012, Russia defenestrated the United States Agency for International Development because it was “meddling in politics.”

Back in 2002, I met a Russian putative politician in Petrozavodsk, a city on the edge of Lake Onega in the Republic of Karelia, Northern Russia who had strong views on the subject of foreign agencies operating in Russia.

“Amnesty International is not good,” he told me,” They are spies.” With that he handed me his business card; his email read president20008@something.something. His name was not Putin, nor Medvedev so as far as I know his political career never made it past propagandising to foreign tourists  but his shtick was more prescient than he possibly knew.

As an aside, my cousin married a Ukrainian woman in Lviv registry office last weekend. The happy couple are honeymooning in Europe. When strangers find out where she is from, they praise the revolution and wish prosperity on entire Ukrainian population.

Canada keeps threat of sanctions on table if Russia interferes in Ukraine

OTTAWA—The Harper government left the threat of sanctions against Russia on the table if it interferes inUkraine, even as federal politicians in Ottawa reacted Monday to the convulsive events there with domestic political mud-slinging.

The possibility of Canadian sanctions against Russia was first raised Sunday by Immigration Minister Chris Alexander on FCA - Ukraine ProtestsCTV’s Question Period.

A day later, Alexander appeared to play down speculation about Canadian sanctions on Russia when he fielded questions from reporters on Parliament Hill, but a spokesman for Foreign Affairs Minister John Baird did not.

“We’re not going to comment on hypothetical scenarios. We want to keep this door towards a return to legitimate institutions, democratic institutions in Ukraine open and we know that that has to be done,” Alexander said Monday.

A day earlier, Alexander told CTV that “sanctions and other, and other measures potentially, as well” would be on the table if Russia intervened. Asked Monday, about those remarks Alexander explained that, “I was asked repeatedly by (the interviewer), ‘What if, what if, what if.’ ”

A written statement from Baird issued earlier Monday made no mention of sanctions against Russia.

However, when asked specifically whether they were a possibility, Baird’s spokesman Adam Hodge replied in an email: “All options are on the table.”

He did not elaborate.

Tensions between the West and Russia continued to run high Monday after Ukrainian authorities replaced their Russian-leaning President Viktor Yanukovych, who fled the capital Kyiv on Friday.

Baird, who was in Australia on an official visit Monday, issued a written statement that welcomed Oleksander Turchinov as Ukraine’s acting president.

“The Ukrainian parliament acted legitimately in naming Speaker Turchinov as acting president pending the May 25 elections, and Canada welcomes his interim appointment during this important transition period,” said Baird’s statement.

“The next critical juncture will be the Ukrainian parliament’s vote to establish a new government under the leadership of a new prime minister, in accordance with the constitution passed on Feb. 22.”

Source: The Star

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