China has uncovered $10bn (£6.1bn) worth of fake trades as part of a
nationwide crackdown on companies.
The currency regulator said 15 fraud cases had been handed over to the police
for prosecution.
Companies sometimes falsify transactions as a way of getting money in and out
of China.
"Fake trade deals can do severe harm to ...the overall economy" said Wu
Ruilin, deputy head of the State Administration of Foreign Exchange (SAFE).
"They not only increase the pressure of hot money inflows, but also provide
illegal channels for cross-border capital flows," he added.
Blame has also been placed on banks operating in China.
"Some banks facilitated the abnormal increase in transit trade financing and
fake trade deals by failing to fulfil the responsibility of authenticity checks and
offering services of transit trade financing and receipt and payment," Mr Wu
was quoted as saying in Xinhua - the state news agency.
The crackdown started in 13 provinces and cities last year, and has widened to
24 this year.
China has strict capital control regulations, which set limits on the purchase and
sale of overseas assets by its residents. It also has similar restrictions on the
buying and selling of Chinese assets by foreigners.
The global commodities markets were shaken in June last year, when an
investigation into trade fraud in China showed companies had used fake receipts
at a port in Qingdao, in east China, to obtain multiple loans using the same
cargo of copper as collateral.
That prompted international banks and trading houses to launch a series of
lawsuits over their exposure, which was estimated to be around $900m.
No comments:
Post a Comment