Bank of China

Top mainland banker held in gambling probe

PUBLISHED : Thursday, 31 May, 2012, 12:00am
UPDATED : Thursday, 31 May, 2012, 12:00am

A senior executive at one of the mainland's Big Four state-controlled banks has been detained amid a widening investigation into allegations of illegal gambling and the misappropriation of clients' money.

Yang Kun (pictured), an executive vice-president of Agricultural Bank of China, was detained several days ago in Beijing by the Central Commission for Discipline Inspection of the Communist Party of China, the party's internal anti-corruption arm that reports to the top leadership.

The move came after the commission received complaints about illegal gambling activities in Macau, sources said. Further investigation found Yang was involved in gambling-related activities, including the alleged misuse of money in a bank client's account, said the sources, who asked not to be identified.

'The case is not clear at this point,' said Wang Lubing, deputy director of the investor relation division at Agricultural Bank.

If Yang is proved to have been involved in illegal activities, it would mark the highest-profile case involving a Big Four banker since the state-owned banks started to go public in 2005. Also, the circumstances surrounding the inquiry raise concerns that it could be widened to implicate others, including bank clients.

In a filing with the Hong Kong stock exchange yesterday, Agricultural Bank said Yang 'is currently assisting relevant mainland authorities in connection with certain investigations'. It said that based on information available 'the bank's business, operations and financial status have not been affected', but it would follow developments and make further announcements 'as and when appropriate'.

The size of the sums alleged to have been misused by Yang remains unclear. But one source said: 'It must be a big case involving big money, given the high level of Yang's position and the quick action taken by the government. He was internally advised not to travel abroad, even just a trip to Hong Kong.'

Another source told the South China Morning Post that Yang was in Macau with business friends several times and the group lost money during at least one gambling trip there. Because Yang and his friends owed large sums to the casinos, complaints emerged and later came to the attention of the party's anti-graft commission, the source said.

How Yang was allowed to travel to Macau remains unclear. Senior executives at Yang's level in state-owned enterprises cannot easily travel outside the mainland on personal or business trips. Typically, they do not hold a private passport but have a special passport issued by the central government for top civil servants.

News of Yang's detention was reported yesterday by, a mainland financial news portal. It said Yang was forbidden to travel abroad about three weeks ago and was detained last week.

Yang, who has worked at Agricultural Bank for more than 20 years, was widely considered to be a rising star in the financial services sector.

In 2010, Agricultural Bank launched the world's largest initial public offering of shares, raising over US$22 billion. The main banker behind the IPO, Pan Gongsheng, also an executive vice-president of the bank, is being tipped to join the central bank as a deputy governor.