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: Prosecutors seek extradition of embezzler on bribery charges

The Supreme People’s Procuratorate said on Tuesday that it has started arrest and extradition procedures against Zhang Hai, the former president of beverage maker Jianlibao Group, who is wanted on suspicion of bribing prison officials to obtain early release



from jail.

Zhang, is said to have left the country with his girlfriend after being freed from jail in 2011. He had served four years behind bars for embezzlement.

“We have notified the Ministry of Public Security, and it has issued a warrant,” the SPP said in a statement. It did not specify where Zhang had gone.

Zhang’s 15-year prison sentence for embezzlement was reduced several times in a series of questionable commutations before he was set free in January 2011.

According to the SPP, prosecutors have investigated 24 suspects for dereliction of duty, including 14 correctional officers and one court judge who allegedly accepted bribes and used their positions to help Zhang get reduced sentences and gain eventual release.

In February 2007, Zhang was convicted of embezzlement and misappropriation of funds and sentenced to 15 years by the Foshan Intermediate People’s Court in Guangdong province. Zhang appealed to the Guangdong Provincial High People’s Court.

Huang Lu, Zhang’s girlfriend, and Kang Jie, Zhang’s secretary, then contacted Luo Jianneng, deputy director of the Foshan detention house, as well as a correctional officer surnamed Chen, who provided tip-offs for Zhang to expose the crimes of two other suspects. Zhang’s assistance in that matter was used as the basis for his first sentence reduction, according to the SPP, and in September 2008, the Guangdong high court shortened Zhang’s sentence to 10 years.

Also in 2008, Huang bribed Guo Zichuan, a senior official at the Guangdong Provincial Prison Management Bureau, to transfer Zhang to another prison and obtain another commutation for him, according to the SPP statement.

In November 2008, Zhang was housed at a prison in Foshan. In December, he was transferred to another prison in Panyu.

In 2009, Huang allegedly bribed Wang Chengkui, former deputy Party chief of the Guangdong Provincial Justice Bureau, to get preferential treatment for Zhang, according to the SPP.

In November that year, Zhang was transferred to Wujiang prison in Shaoguan to serve his sentence.

While there, Zhang allegedly directed others to falsely obtain a patent for a new type of product. Based on that, the prison touted Zhang’s merits, according to the SPP, and in September 2010, the prison requested that the Shaoguan Intermediate People’s Court shorten Zhang’s sentence because of his good behavior. The court complied, and Zhang’s sentence was commuted by two years.

On Jan 25, 2011, his sentence was again commuted by the court, which cited Zhang’s “significant contribution”.

Zhang was set free from jail the next day.

Hong Daode, a law professor at China University of Political Science and Law, said that if law enforcement officials abused their power and accepted bribes in Zhang’s case, it would indicate serious corruption in the detention and prison system.

“Corruption in law enforcement agencies should be eliminated,” Hong said. “Meanwhile, the prosecuting departments should perform their duties to improve supervision over the prison system.”

Li Fang, a lawyer from the All-China Lawyers Association, suggested that correctional officers should be required to present all requests for commutations to prosecutors stationed at the prisons. After review, a prosecutor should obtain a second review by a higher court before taking any action.

Moreover, when a higher court hears commutation cases, public hearings should be held to avoid miscarriages of justice, Li said, adding that judges should visit the prisons to obtain first-hand evidence rather than making decisions based solely on written documents.

A number of individuals have been prosecuted and convicted in the case.

Guo Zichuan was convicted of accepting bribes and of dereliction of duty, and was sentenced to six years in prison by a local court.

Ting Xiongfei, former director of the examination and supervision department of the Shaoguan Intermediate People’s Court, was convicted of bribery and was sentenced to five years in prison.

Luo Jianneng was convicted of accepting bribes and was also sentenced to five years.

Other suspects are facing prosecution.

Source: ECNS

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