China launches probe into alleged graft at telcos

0 CommentsPrint E-mail, May 31, 2011
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The Chinese communist party's chief disciplinary body has launched a large-scale anti-corruption campaign targeting executives of the country's three state-owned telecom operators, after several China Mobile executives were found involved in corrution cases, Caixin Magazine reported Monday.

Officials from the Central Commission for Discipline Inspection have moved in recent weeks to detain and interrogate leadership at China Mobile, China Unicom and China Telecom, the magazine reported.

Senior executives at the three telecom carriers have all been required to hand in their passports, Caixin reported, citing people close to the matter.

The government and telecom firms have refused to comment on the investigation. But public commentary on dismissed executives at China Mobile has spread like wildfire.

The investigation will last until June, during which all middle-level and above administrative staff have been asked to submit their passports.

Seven high-ranking China Mobile executives have been punished since 2009. Former Party chief and deputy general manager of China Mobile Zhang Chunjiang has been removed from his official post and expelled from the CPC for taking bribes. Shi Wanzhong, general manager of human resources at China Mobile, was detained for accepting bribes from Siemens. Lin Donghua, former deputy general manager of China Mobile's Hubei branch, was also punished for serious corruption.

In March 2010, several regulatory authorities opened an investigation of Li Xiangdong, former general manager of China Mobile Sichuan's wireless music base. After meeting with central government auditors to discuss his assets and the allocation of company funds, he disappeared into the night with hundreds of millions of RMB. Luckily, he was caught by police before he could flee the country.

China Mobile recently confirmed that Ma Li, deputy general manager of the company's data division, was under investigation on suspicion of "serious disciplinary violations."

Ye Bing, former CEO of ASPire Holdings, a subsidiary of China Mobile, had also been taken away by authorities for investigation. Ye Bing was appointed as CEO of ASPire Holdings in 2008, which provides data services for China Mobile.

"Lack of efficient supervision on high-profile executives of governments and companies has led to rent seeking behavior," said Fu Liang, an independent telecommunications analyst.

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