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Up to 18,000 corrupt officials fled China over a 15-year period with loot of $124bn
By Finfacts Team
Jun 17, 2011 - 3:59 AM
|The Mandarin on the top right-hand corner reads: 'Internal materials; Store carefully'|
The People's Bank of China, China's central bank, says in a report published
this week that an estimated 16,000 to 18,000 officials - - Communist Party
officers, state company executives, civil servants, police and members of the judiciary - - fled
the country or went into hiding, in the 15-year period from the 1990s to 2008, with loot of Rmb800bn
Local reports said the 67-page study was posted
on the website of China’s central bank. However, while the
(in Mandarin) remains available in Chinese
cyberspace, the report no longer appears on
the People’s Bank of China website.
Chinese capital controls limit individuals to
annual remittances of just $50,000 in or out of the country.
The 'China Daily' newspaper says the eight main
channels for moving funds are: smuggling cash, underground banking services,
trade under current accounts, overseas investment, credit cards, offshore
financial centres, direct overseas payments and payments to family members or
lovers living overseas.
However, the exact amount of assets transferred overseas, since Chinese
officials began to flee the country at the end of the 1980s, remains a mystery,
said the report.
The cross-border transfer of such assets causes huge losses to the country as
the majority cannot be recovered and their whereabouts are hard to find, the
The total was equivalent to 2% of 2010 GDP (gross
The report also provided details about the destinations for corrupt officials
People with a higher rank or larger assets tended to flee to Western countries
such as the United States, Canada, Australia and the Netherlands.
Those who cannot reach Western countries directly, use Hong Kong or some small
countries in Africa, East Europe and Latin America as a stopover.
Those with lower rankings or smaller assets often find safe havens in China's
neighbouring countries such as Thailand, Myanmar, Malaysia, Mongolia and Russia.
bank said that authorities in "sensitive industries" such as finance,
state-owned monopolies, transport, land and construction sectors and tax, trade
and investment departments should increase inspections and strengthen
cooperation between banking regulators and other government bodies to fight
In China, banks, brokers, futures companies and insurers are required to report
transactions involving huge sums of cash to regulators as the country beefs up
its efforts to curb money laundering.
Cross-border transfers of more than US$10,000 involving an individual have to be
reported to the central bank.
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