A Malaysian pharmaceutical businessman has claimed that the Bank of China dishonestly made his 100 million yuan bank deposit shrink to 8.92 yuan.
Mr. Cai ShaoHong, a pharmaceutical manufacturer, exposed the cheating process to audiences at the sixth Nine Commentaries on the Communist Party forum held in Penang on July 23, 2006.
The Cheating Process
Cai's father lived in Ipoh when he was alive. His father had opened a current account in the Bank of China Singapore branch and deposited total of 111 million FaBi (Kuomingdang's currency) through a Malaysian agent from August 1946 to May 1948. The value of the current account deposit was equivalent to more than 20 million USD at that time, says Cai. In 1953, the Chinese Communist Party placed a public notice in Malaysia newspapers to inform their customers to claim back deposits from the Bank of China Singapore branch. On August 23, 1953, Cai's father went through the administrative procedures hoping to withdraw his deposit within the given 1 year period.
The Singapore branch collected two check books and a bank deposit book from his father as part of the procedures. Since that time, they have not been able to withdraw any money from the bank for years. The branch had explained to them that the Headquarter in Xiamen did not transfer their money to the branch. The 'transfer' was delayed for years.
Cai's father passed away in 1983. After thirty years of continuous trying, not a single cent could be withdrawn. Cai's father had written a will to authorise Cai to get back the bank deposit on behalf of him.
Dramatically In 1997, the bank sent a letter to inform Cai that the deposit was only worth 8.92 Yuan. He was instructed to withdraw the money from the Headquarters in Xiamen, China.
When Cai approached the Bank of China Malaysia branch in Kuala Lumpur, the bank told him that they were only the Malaysian branch and has no relationship with the Headquarters in Xiamen, China.
“This is nonsense. Aren't all the branches of the Bank of China in the world under control by the Headquarters in Xiamen? Isn't the logo of the Kuala Lumpur branch the same as the rest of other branches?” Cai asked the audience.
He also tried to get back the bank deposit from the Singapore branch many times. At first, the Singapore branch even went to the extent of denying the existence of such a bank account.
When both branches failed to answer his query, Cai hired a lawyer and went straight to the Xiamen Headquarters of the Bank of China. When he contacted the bank for the first time, he was told that his father had already withdrawn the money and closed the account. On the second meeting, Cai insisted on checking the old transaction records. At the end, the bank had verified the account was still active, but the bank deposit balance was left with only 8.92 Yuan.
According to Cai, the Malaysian media were at first interested in reporting the news. However, due to tremendous pressure from the Bank of China, the media were quiet about the case at the end. As a last resort, Cai filed a lawsuit in the court against the Bank of China Malaysia and Singapore branches in 1997 which persists until today.
He said, “The representing lawyer of the Bank of China received instructions from the Bank that he must win this court case. The bank tried to use its huge monetary resources to bully and twist the arms of its opponent. They wanted to exhaust my monetary resources in the long and expensive court case.”
Furthermore, Cai said the Bank of China had used all means trying to defeat Cai, intending to publicise the news to warn others not to sue the bank. There were many other victims with similar cases. If he wins the lawsuit, the Bank of China will have to face others too, Cai explained in the forum.
Calculation Methods of the Deposit
How did the bank calculate the deposit to justify a 100 million yuan bank deposit becoming only worth 9 yuan? In the forum, Cai displayed the letter from the Bank of China to his father. In the letter, four calculation methods were used by the bank. The first three were based on the repayment method approved on January 9, 1953 by the People's Government Administration Council of China.
1. The first calculation method used by the Overseas Chinese Service Department of the Bank of China in Xiamen was: For the first five thousand Yuan of the deposit, only 570 Yuan was refundable. For amounts above five thousand Yuan, only ten percent of the deposit amount was refundable. Base on this calculation, Cai's deposit was reduced to 11,152,743.13 Yuan (Figure 1).
This calculation method, determined by the Chinese Communist Party (CCP), was actually meant for fixed deposits. But in fact, Cai's father's account is not a fixed deposit account but a current account.
2. After discounting the refundable amount based on the calculation method for fixed deposits, the bank further discounted the amount refundable by eighty percent by using the calculation chart for current accounts. The bank deposit was only left with 8,923,450.49 Yuan after the second calculation.
3. For the third method, the bank used the repayment standard from 1937 to August 1948 (Figure 2) to further discount the remaining 8 million. The sum was somehow multiplied by 0.01 and thus the value of the deposit was reduced to 89,234 Yuan.
In reality, Cai's father deposited the money between Aug 1946 and May 1948. If based on the calculation chart of the CCP, the conversion rate for 2 million deposited in 1946 should be 1 to 3.25. As for the over 100 million deposited before May 1948 (Figure 3), the conversion rate for 1947 is 1 to 0.46. In fact, the bank used none of the conversion rates in between 1937 and August 1948 but chose to use the conversion rate after August 1948, which is 0.01.
4. Lastly, the bank invented the calculation method of “exchanging old currency with new currency”. They fixed the rule that every 10,000 of the old Yuan currency would be exchangeable for 1 new Yuan currency. At the end, the 89,234 Yuan deposit was reduced to only 8.92 Yuan. This calculation method was in fact self-invented, says Cai. (See bottom part of figure 4.)
Cai said that his deposit used to be worth more than 20 million USD. The Bank of China delayed repayment of this deposit for more than thirty years and finally used these ridiculous calculation methods to reduce a 100 million deposit to only 9 Yuan. This was indeed very much like the fabrication, lies and cheating methods commonly used by the CCP. Cai said even if they used the repayment standards approved by the People's Government Administrative Council in 1953, he could have got back at least 8 million Yuan. He simply cannot accept the calculation methods used by the Bank of China.
“I have received in total a few millions in interest [on statements], so how could 9 yuan fetch so much interest?” said Mr. Cai.
Furthermore, the Bank of China Malaysia branch intended to sue Cai for “damaging” its reputation and wanted him to compensate the bank.
Cai said during the old times, the overseas Chinese wanted to contribute financially to China because of Japan invasion. Thus many of them transferred their savings to China. Having the similar mindset, Cai's father deposited his hard-earned money from trading rubber in the Bank of China. He said besides his father, there were many other people who could not get back their bank deposits. He finally appealed to all the people who had placed deposits with the Bank of China and were cheated their deposits to step forward and demand their deposits with the bank to be returned and expose the truth to the public.