China's National Audit Office recently disclosed the 2005 inspection results for the Agricultural Bank of China (ABC), revealing an assortment of irregularities indicating malpractice and fraud. The irregularities documented in the report amounted to 61.56 billion yuan (US$7.7 billion), as well as prominent risks with the bank's administrative structure and loans. On June 19, Chinese official media reported that in response to the problems revealed by the inspection, ABC fired 64 employees and took disciplinary actions against nearly 1,300 other employees.
According to the 2005 audit books published on June 28, a graft worth 5.51 billion yuan ($689 million) were disclosed in the audit for 48 central government departments. The irregularities in financial organizations were even more serious, in which ABC alone contributed 61.56 billion yuan ($7.7 billion).
China's National Audit Office reported that amongst ABC's irregularities were deposits fraud of 14.27 billion yuan ($1.79 billion), illegally granted loans worth 27.62 billion yuan ($3.45 billion) and "fraudulent" issuing of bills totaling 9.72 billion yuan ($1.22 billion). In addition, the Audit office discovered 1.27 billion yuan ($158 million) of accounting fraud, with 1.18 billion yuan ($148 million) being bookkeeping fraud, and 84.93 million yuan ($10.6 million) in embezzlement.
According to a Chinese newspaper, ABC has removed 11 provincial-level branch managers or vice-managers who violated regulations. These managers were from ABC branches in Dalian City, Tianjin City, and Heilongjiang, Hunan, Jilin and Gansu provinces.
The Beijing Times reported that up until now, "ABC has already taken actions with the 1,331 people involved in the criminal wrongdoings." The report further stated that three provincial-level branch managers were fired, seven provincial-level branch executives were under investigation, and 15 department managers had been "disciplined". Twenty-one of the 1,331 employees who have faced disciplinary action have now been referred to judicial authorities.
Beijing Youth Daily also reported that ABC has placed 38 employees under investigation, had 60 people fired, 14 demoted, 208 given a demerit, and 926 people fined or given other unspecified punishments.
Chief auditor, Li Jinhua, said officials at 48 central government departments misused 5.5 billion yuan ($689 million) and that a total of 213 officials were involved. Illegal deals and bribery were suspected in 20 high-level road construction projects that had no strict bidding regulations.
The Director of the Banking department of China's National Audit Office, Fan Peng, expressed that in the future emphasis of monetary audit would be a full-scale audit on the branch offices of the financial institution. This year, China's National Audit office will focus on The Bank of China, The Bank of Communications, and China Merchants Bank.
Feeds