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Crackdown nets 599 suspect entrepreneurs
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At least 599 entrepreneurs were named as suspects in 463 criminal cases in China last year, with around a quarter of them being controllers of companies, according to a new report.
The numbers represent a 120 percent increase from the 272 people reported in 2012, showing a growing trend of criminal offense in the business sector as well as an intensified government crackdown on corruption and other wrongdoing.
Among the 599, 128 were from state-owned enterprises while 469 were from the private sector, according to the study released by Beijing Normal University. Two were not classified because their companies’ ownership structure could not be identified.
Major cases included the corruption probe into top Asian oil company PetroChina Co that brought down several former senior executives, including ex-chairman Jiang Jiemin, and the bribery scandal involving UK drug giant GlaxoSmithKline.
The university’s study aims to provide a clear picture of the situation and trends in business crimes for future crime prevention.
It was compiled based on public reports in the media.
The cases involving state companies usually emerged following probes by government or Party authorities while those involving private companies typically were identified after being reported to police by victims, the study said.
Among the toppled entrepreneurs, 224 held the title of general manager, 133 were chairmen, 44 were chief engineers of chief accountants, and 152 were the controller of their companies.
High-ranking executives were the majority of criminal suspects among entrepreneurs in China, but the number of company controller rose sharply, the report said. In the 2012 study, only 12 were the controllers.
That increase showed the lack of a monitoring system to restrict the power of the top man of a company, the study said.
Among the 599 suspects, 480 were male while 93 were female. The gender of the others were not specified.
Only the ages of 194 suspects were made public, averaging 43.2 years, the report said. Thirteen were in their 50s, the most among all age groups.
Also, the age of suspect officials of state-owned enterprises averaged 49, compared with 40.6 for those in the private sector, according to the report. The same trend was seen in earlier studies.
The suspects also appear to have higher educational background than those named last year. Among the 90 whose education level were known, two thirds hold a bachelor’s degree or higher. That’s significantly higher than in 2012, the report said.
Among the cases involving state companies, the majority involved wrongdoing in internal financial issues, followed by trade issues and the awarding of engineering contracts.
In the private sector, misdeeds involving internal financial management also topped other issues, accounting for 39.2 percent of the total.
In 2012, the top problem for private entrepreneurs was illegal fundraising, accounting for 36.4 percent of the total. The proportion of illegal fundraising fell to around 20 percent in 2013, still a high level, showing lingering difficulties faced by the private sector in financing day-to-day operations.
By region, Beijing had the most criminal cases involving entrepreneurs, with 57 companies. It was followed by Guangdong and Zhejiang provinces, each with 55.
But Shanghai, although it has the highest level of economic development on the mainland, was not high on the list. The city ranked 13th among all Chinese municipalities and provinces in criminal cases involving entrepreneurs, the report said.
By industry, the criminal cases were found mainly in mining and energy, property and construction, finance and pharmaceutical.
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