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Enoch Yiu

Liu Jinbao's punishment a lesson on graft, bank says

Former Bank of China (Hong Kong) chief executive Liu Jinbao  was yesterday given a suspended death penalty for corruption, in an apparent effort by Beijing to salvage confidence in its scandal-plagued banking system.

The ruling, handed down by a court in Changchun , Jilin province , was described by mainland legal experts as reasonable, while bankers in Hong Kong said it showed the central government's determination to fight graft.

Liu's fellow bank executives, charged with collaborating with him in 23 counts of corruption, also received hefty jail sentences and fines. Former deputy chief executives Zhu Chi  and Ding Yansheng  were jailed for 13 years and fined  2 million yuan, while his close aide Zhang Debao  was given an eight-year term and 1.5 million yuan fine, Xinhua reported yesterday.

The court said Liu was the 'main culprit' in the crime, which it described as 'extremely serious' and involving the embezzlement of an 'extraordinarily large' sum.

Liu was given a suspended death sentence because he had helped investigators retrieve all his proceeds of corruption, both in China and overseas, the court said.

Liu was charged with embezzling, solely or in collaboration with others, more than 14  million yuan between March 1996 and May 2003, while he was working in BOC's Shanghai branch and the Hong Kong unit.

Of the amount embezzled, Liu personally gained about 7  million yuan, prosecutors said. He also received bribes totalling 1.43  million yuan.

As well as the death sentence, suspended for two years, for his overall crimes, Liu was given a  12-year jail term on the bribery charges and another five years for being unable to account for another 14 million yuan in personal assets.

The court also ruled that Liu be stripped of his political rights and all his personal property confiscated.

The ruling came as the mainland prepares for the overseas listing of its state-owned banks.

BOC spokesman Wang Zhaowen  said the case reflected the need to strengthen supervision of senior management in the banking system to prevent 'power going out of control, as well as wrongful decisions and behaviour'.

Mr Wang said BOC would learn a lesson from the case. The bank would educate its staff to abide by the law and strengthen its corporate governance.

Chen Xingliang , a prominent criminal law expert and deputy dean of Peking University Law School, said Liu's sentence was 'fairly reasonable' given the huge amount of the bribes involved.

He said that under Chinese criminal law, a death sentence could be warranted for bribes amounting to 100,000 yuan if the circumstances were serious.

'The amount of illegal money in his case is huge, enough to incur a death sentence. Liu's sentence is fairly reasonable and can be considered light,' he said.

Liu, former chairman of the Hong Kong Association of Banks, could appeal but the chance of a revised judgment would be slim, as the sentence was 'fair enough', Professor Chen said.

A suspended death sentence is often, but not always, eventually commuted to life imprisonment.

Stanley Wong Yuen-fai, deputy general manager of ICBC (Asia), said it was a shame that a good banker had become corrupted.

'It is a shame for us to lose a good banker like Mr Liu who had successfully completed the merger of the 12 banks to form BOCHK and then list its shares in the stock exchange.'

Mr Wong said the central government wanted to send a message to warn other financial officials and bankers not to commit corruption.

He said Liu's case would not affect the mainland's banking sector reform, however. 'It is a national policy that will not be affected by an individual case.'



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Yuan

Ex-BOCHK head given suspended death sentence

Bank of China (BOC)