Crime more rampant in private sector than China's state-owned firms in 2013: report

Bribery tops list of state-owned firm executives' wrongdoing, while misuse of public funds a common thread between two sectors

PUBLISHED : Monday, 06 January, 2014, 12:22pm
UPDATED : Monday, 06 January, 2014, 3:00pm

There were more private-sector entrepreneurs reported to have committed crimes such as fraud or fund scams than their counterparts in state-owned enterprises last year, a report issued on Monday showed.

The Chinese Entrepreneurs Crime Report 2013 was published by the Chinese Entrepreneur Crime Prevention Research Centre and Beijing Normal University, and is the second such report since the centre’s founding in December 2012.

There were 463 reported criminal cases last year, up by 80 per cent from the previous year. The latest cases included 469 private entrepreneurs and 128 from state-owned firms, with the total marking a 120 per cent increase from 2012.

“This indicates the public [and] media are paying more attention to the criminal cases involving entrepreneurs. Also, the crimes conducted by entrepreneurs are in a rising trend,” said the report.

Corruption was the overarching crime among the entrepreneurs. For state-owned firms’ officers, the top three reported crimes involved bribery, embezzlement and misappropriation of public funds. For the private sector, the top crimes were the illegal collection of personal savings deposits, fraud and misappropriating public funds.

The report is mainly based on the news reports from mainstream media including, and Senior executive positions such as board secretary and chief finance officer are categorised as entrepreneurs.

Most of the implicated entrepreneurs are in top positions such as chairman or general manager. The lack of appropriate supervision on the powerful “enterprise heads” lead to the rise in crime, said the report.

The average age of the accused private-sector executives was 41, and it was 49 for the public sector. The oldest state-owned firm entrepreneur sued last year was 74.

The report added that 220 entrepreneurs were sentenced to jail for periods ranging from six months to 20 years, fourteen were given life sentences, while 10 were placed on death row, five of whom received a two-year suspension.

The report also listed the top 10 criminal cases that year, with the China National Petroleum Corporation (CNPC) corruption scandal ranking the first. At least four senior executives with the CNPC have been arrested and Jiang Jiemin, the former head of CNPC is also under investigation.