Related News
Home 禄 Opinion 禄 Opinion Columns
Developers, lawyers, bankers connived to create housing bubble
THE criminal conviction of a real estate tycoon in Beijing last Wednesday revealed a dirty game by an unholy "trinity" - how a scheming estate developer, lawyers and bankers jointly created a housing bubble.
A local court in Beijing sentenced Zou Qing, who once had interests in 26 prime commercial projects in Beijing and Shanghai, to life in prison for contract frauds and other crimes.
From 2000 to 2002, he swindled 750 million yuan (US$110 million) worth of mortgages from the Beijing branch of Bank of China by forging sales contracts.
He forced his employees and begged his friends to "rush to buy" the apartments in his projects at a time when sales were slack.
Armed with false certificates of income - endorsed by conniving lawyers - those employees and friends went to the bank for mortgages.
It would be naive to believe that the bank was so easily cheated. The bank checked those "buyers" and found that they were nearly all linked to Zou Qing's real estate companies. Moreover, the bank found that Zou's companies were responsible for the monthly payments to the bank by many of those "buyers."
Why did the bank provide loans to those false buyers anyway? Beijing Daily on Thursday quoted a bank insider as saying that competition was so fierce among commercial banks that it had become an open secret for banks to extend mortgages to "individual buyers" who were not really borrowing for themselves, but on behalf of a real estate developer.
Such a scheme would often create a mirage of "robust sales" of apartments when actually there was no real buyer.
One could understand why a crooked real estate developer and immoral lawyers would do that, but it's hard to understand why a bank, knowing the high risk of false income reports, would become part of the scheme.
On April 16, Xi Xiaoming, vice president of the Supreme People's Court, said cases of false mortgages had begun to emerge, especially from last February to this February.
Zou's case might have been the tip of the iceberg of the mortgage schemes in major cities. There won't be an end to such cases unless banks are really risky averse.
A local court in Beijing sentenced Zou Qing, who once had interests in 26 prime commercial projects in Beijing and Shanghai, to life in prison for contract frauds and other crimes.
From 2000 to 2002, he swindled 750 million yuan (US$110 million) worth of mortgages from the Beijing branch of Bank of China by forging sales contracts.
He forced his employees and begged his friends to "rush to buy" the apartments in his projects at a time when sales were slack.
Armed with false certificates of income - endorsed by conniving lawyers - those employees and friends went to the bank for mortgages.
It would be naive to believe that the bank was so easily cheated. The bank checked those "buyers" and found that they were nearly all linked to Zou Qing's real estate companies. Moreover, the bank found that Zou's companies were responsible for the monthly payments to the bank by many of those "buyers."
Why did the bank provide loans to those false buyers anyway? Beijing Daily on Thursday quoted a bank insider as saying that competition was so fierce among commercial banks that it had become an open secret for banks to extend mortgages to "individual buyers" who were not really borrowing for themselves, but on behalf of a real estate developer.
Such a scheme would often create a mirage of "robust sales" of apartments when actually there was no real buyer.
One could understand why a crooked real estate developer and immoral lawyers would do that, but it's hard to understand why a bank, knowing the high risk of false income reports, would become part of the scheme.
On April 16, Xi Xiaoming, vice president of the Supreme People's Court, said cases of false mortgages had begun to emerge, especially from last February to this February.
Zou's case might have been the tip of the iceberg of the mortgage schemes in major cities. There won't be an end to such cases unless banks are really risky averse.
- About Us
- |
- Terms of Use
- |
-
RSS
- |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 娌狪CP璇侊細娌狪CP澶05050403鍙-1
- |
- 浜掕仈缃戞柊闂讳俊鎭湇鍔¤鍙瘉锛31120180004
- |
- 缃戠粶瑙嗗惉璁稿彲璇侊細0909346
- |
- 骞挎挱鐢佃鑺傜洰鍒朵綔璁稿彲璇侊細娌瓧绗354鍙
- |
- 澧炲肩數淇′笟鍔$粡钀ヨ鍙瘉锛氭勃B2-20120012
Copyright 漏 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.