New white paper on financial crimes

Illegal fundraising is becoming a growing problem, while fewer fraud cases were brought to trial last year, according to a white paper on financial crimes released yesterday.

Illegal fundraising is becoming a growing problem, while fewer fraud cases were brought to trial last year, according to a white paper on financial crimes released yesterday by the Shanghai People’s Procuratorate.

Last year, prosecutors across Shanghai filed charges against 3,107 people in 1,662 financial crime cases, compared with 2016 figures of 2,895 people in 1,683 cases.

Financial fraud, including credit card fraud, remained the top problem for prosecutors; even though the number of cases filed last year dropped 23 percent to 878. In contrast, the number of cases involving damaging the financial-management order, notably illegal fundraising, increased 46 percent to 737 in 2017.

Case records show illegal fundraising usually involves well-organized cross-provincial networks and criminals spending large sums on advertisements via traditional media such as TV stations and radio channels. Such advertisements often reach senior citizens, according to the court’s paper.

Prosecutors said illegal acts related to illegal fundraising, such as money laundering, also increased.

Another problem, according to prosecutors, is that financial industry players are increasingly taking part in financial crimes.

Last year, 39 insiders were implicated in 34 cases involving 4.6 billion yuan (US$695 million). Nearly half of these individuals were from securities firms, with graft and embezzlement being common charges. In most cases, managers conspired with subordinates and covered for each other’s crimes, according to the court document.

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