China Daily said on November 21 that this year, China has stepped up anti-corruption efforts in the financial sector, including regulatory agencies and the banking, insurance, and securities industries, to ensure protect economic security.
The country’s top anti-corruption watchdogs, the Communist Party of China’s Central Commission for Discipline Inspection and the National Supervisory Commission, have announced investigations or punishments for about 90 officials. department in the financial system.
Eight of them, including former Vice Chairman of the Industrial and Commercial Bank of China (ICBC) Zhang Hongli, former Secretary of ICBC’s Disciplinary Inspection Committee, Liu Lixian; and two former Vice Presidents of the China Development Bank (Zhou Qingyu, Wang Yongsheng), all under the management of the Central Organization Department of the Communist Party of China.
Officials at all five state banks, namely Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, Bank of Communications and China Construction Bank, have been investigated this year .
Investigations were extended to officials from insurance companies, securities institutions, financial corporations, banking regulators, central banks, securities regulatory systems and other agencies. local financial management.
The Central Financial Work Conference held in Beijing last month emphasized the need to resolve contradictions and intertwined problems in the domestic financial sector.
The report at the conference said that outstanding issues that need to be addressed include potential financial risks, low quality and ineffective financial services for the real economy, financial crime and corruption. recurring, along with weak financial management and supervision capacity.
Authorities are called on to adopt a consistent and cautious approach to addressing risks, resolutely punishing illegal activities and corruption, and guarding against moral hazard.
Mr. Zhuang Deshui, Deputy Director of the Research Center for Building Government Integrity at Peking University, said recent announcements of investigations into officials in the financial sector are closely related to the programs. The work carried out by the Central Commission for Discipline Inspection earlier this year did not only stem from concerns expressed at the Central Financial Work Conference at the end of October.
“The conference raised higher requirements in fighting corruption in the financial sector, to promote financial system reform and prevent financial risks,” he said.
In January, a communiqué from the Central Commission for Discipline Inspection announced an anti-corruption crackdown that combined political and economic issues. It emphasized efforts to strengthen anti-corruption in key areas and strengthen reforms in areas with concentrated power and abundant capital and resources, such as finance, state-owned enterprises, and government. governance and legal, purchasing and selling of grain.
Last September, the Politburo of the Central Committee of the Communist Party of China called for increased supervision of top leaders at all levels of state-owned enterprises and increased anti-corruption efforts. At the same time, learning from the first round of inspections by the 20th Central Committee of the Communist Party of China deployed in March, targeting centrally managed enterprises, including those under financial sector.
The second round of inspections launched on October 10, 2023 is being implemented, targeting 31 subjects, including party committees of state-owned enterprises managed by the Central government and party committees of some agencies. State agencies such as the Ministry of Science and Technology, Ministry of Industry and Information Technology…
The moves by China’s central government have set a strict framework for how anti-corruption efforts will be conducted in the financial sector. Mr. Zhuang Deshui said that anti-corruption initiatives will continue to be strengthened.
A recent article published by the Central Commission for Discipline Inspection of the Communist Party of China and the National Supervisory Commission said that risks in China’s financial sector mainly stem from systemic impacts. system of macroeconomic changes to the financial system, the continued accumulation of risks in the financial system and the spillover of external risks.
The article said that the three types of risks mentioned above do not exist separately and can easily combine due to risk accumulation, causing increasingly widespread systemic financial risks.
According to Mr. Zhuang Deshui, corruption is one of the main risks in the financial system and issues directly or indirectly related to corruption can have a significant impact on political and economic security.
“Without significant correction and repression, these problems could drain financial resources and jeopardize economic security,” he emphasized.
In China in particular as well as in other countries, the financial sector is prone to corruption because it involves abundant resources and significant benefits. This is a long-standing problem, but the heightened anti-corruption stance over the past decade has drawn more attention to corruption issues in the financial sector, Zhuang said.
The issue of abuse of power for personal gain and conversion of benefits is the cause of many cases of financial corruption.
For example, some officials in financial regulatory agencies have formed “alliances” with those they supervise, providing inside information, and some practitioners have used their advantages in this sector to gain benefits and cause financial chaos in the country.