A senior manager of a Beijing company and two accomplices have been given tough jail sentences by for their part in a scam that involved bribery of bank officials and forgery of documents.

The harsh sentences handed down by Beijing municipal intermediate court reflect China's determination to clean up corruption and bad loans in its banking and corporate sectors.

Three jailed

Cai Yanjun, former general manager of Beijing Wanze Economic Information Consultancy (BWEIC), received a life sentence from the court for his lead role in swindling banks out of 170 million yuan. He did this by bribing bank officials and forging business documents according to the official Beijing Times newspaper.

Lengthy jail terms are also in prospect for two of Cai's accomplices. Chen Qijin, who was a BWEIC director, received a sentence of eight years imprisonment while Tian Chengxin, a former general manager of a Beijing oil-trading firm was sentenced to 11 years' jail. All three have reportedly said they will appeal the sentences.

Bribes

The court heard that Cai and his accomplices began approaching government and bank officials in 1998 when they offered them bribes to obtain loans.

A 50,000-yuan bribe was paid to former deputy director of Beijing municipal grain bureau, Jia Mingzhen, while US$3,000 was paid to former president of Huaxia Bank, Duan Xiaoxing.

Forged documents

Prosecutors told the court that Cai, Tian and Chen fabricated business documents including contracts, board meeting resolutions, balance sheets, and profit and loss statements.

The documents were then presented to Huaxia Bank's Zizhuqiao branch where bank staff approved two loans, one for 150 million yuan and the other for 20 million yuan. Only about 10 million yuan of the loans have been recovered.

Regulator's role

Scams such as this one where company and bank officials collude to obtain bank facilities such as documentary credits are clearly a target for the recently formed China Banking Regulatory Commission.

It is investigating Shanghai property tycoon Chau Ching-ngai and former president of Bank of China Hong Kong Liu Jinbao over irregular loans amounting to several billion yuan (DCWorld, 06 June 2003).

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