How a grass-roots Chinese official used fake invoices and correction fluid to embezzle US$5 million
- Investigators found embezzler’s ‘primitive’ schemes worked for 11 years
- City official made people up and took money for claimants after their deaths
An official who pocketed more than 35 million yuan (US$5 million) from China’s special funds for poverty relief used the simplest of tricks without being noticed for 11 years.
China Discipline and Supervision Daily, the official newspaper of China’s top watchdog, reported that Chen Zhixiang, a minor official who oversaw the civil affairs of Gangkou county in the city of Zhongshan, Guangdong province, was left in control of the local purse strings of a national campaign that was pledged in 2015 to wipe out poverty.
Investigators with Zhongshan Municipality Commission for Discipline Inspection said Chen took money from all of the 14 special purpose funds that he handled from 2007 to 2017. Their report said dozens of people could be involved.
The watchdog said Chen committed 529 offences involving sums of between 20 and 700,000 yuan that totalled 35.87 million yuan. In 2016 alone, he took 7.26 million yuan – 60 per cent of the anti-poverty funds disbursed that year.
“I did not expect to get the money successfully,” Chen was quoted as telling told investigators. “My modus operandi is very primitive. I don’t know why no one found out.”
China’s state Xinhua News Agency reported that Chen clumsily altered invoices and other documents. In one instance, he used correction fluid to change an amount received from “18623” to “623”.
Chen bought and used fake invoices from an internet vendor that looked nothing like the documents issued by the banks, Xinhua reported.
Chen exaggerated the number of poor eligible for help, adding fictitious names and never striking off the names of deceased claimants.
Investigators found Chen also managed to automate the embezzlement process by adding his account number to the details of fictitious aid recipients submitted to the banks so that he would receive money automatically.
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Peng Lixin, the investigative team leader, was quoted by Xinhua as saying that central government officials assumed that the banks would checked the numbers and names of welfare fund recipients, while the banks assumed information provided to them would not be false, so “no one checked” in the end.
The watchdog’s report implicated 22 people in the Chen case. Chen’s superior Wu Shaoqiong, who was the director of civil affairs of Gangkou county, was charged with negligence.
Chen, who has been detained in connection with the embezzlement since May, has not yet been charged as investigations are not complete.
Chinese President Xi Jinping vowed to wipe out poverty in 2015. Beijing is to commit 90 billion yuan to poverty alleviation in 2019, to achieve the goal of no one living below the poverty line by 2020.