Chinese banks uncovered 613 criminal cases involving their funds in the first nine months of 2005, about 40 percent more than a year earlier, the bank regulator said on Tuesday, underscoring a tough battle to rein in financial risks.
Authorities had handled 894 criminal cases among banking institutions during the January-September period, resulting in the punishment of 892 officials, the China Banking Regulatory Commission said in a statement after an official meeting. It did not reveal the amount of funds involved.
"The statistics showed that major cases are striking, with many people absconding with public funds and continuing cases involving people inside banks colluding with outsiders," the regulator said in the statement, published on its regulator's Web site (www.cbrc.gov.cn).
The major cases alone had involved 1.02 billion yuan ($126 million) in the first nine months, it said. The government has in recent months stepped up a crackdown on crimes at major state banks, smaller commercial banks and rural credit co-operatives by improving internal audits.
Of the officials who had been punished, 209 had held senior posts while 167 had been middle-level managers, the regulator said.
Government efforts to reform China's creaking banking sector, buckling under mountains of bad loans, have been tarnished by a strain of scandals that have underscored poor corporate governance and weak internal controls within state lenders. In August the former chief of Bank of China's [BOC.UL] Hong Kong arm, Liu Jinbao, received a suspended death sentence on charges of corruption. And a former Construction Bank chairman, Zhang Enzhao, is still under investigation amid corruption allegations.
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