Sunday, August 25, 2013


What if it was you in that chair ?
Court testimony in the corruption trial of disgraced Chinese leader Bo Xilai has revealed that he embezzled government funds, and took bribes, that totaled the equivalent of $4.4m . You would do well to remember that, the next time a prospective bank client who professes to be a wealthy Chinese businessmen comes in to open a new account relationship at your Western bank. Is he really a PEP, and has he artfully concealed who he is fronting for ? If you bank a number of customers like him, it might be prudent to retain the services of a good Hong Kong investigative firm, to separate the legitimate clients from the PEPs.

One more item about China and risk; you certainly are aware that a British businessman, and his American wife, both engaged in a China-based risk management firm, have been detained by the authorities, on the patently bogus charge that he once did contract work for a foreign pharmaceutical firm now accused of bribery. Some observers now claim that the case was orchestrated to give local Chinese companies an advantage over their foreign competition in the Chinese marketplace.

Finally, not to intentionally frighten you about China risk, but friends and family of Bo Xilai claim that not all the proceedings at his trial are being transcribed and released to the outside media. They specifically state that Bo was subjected to literally a hundred hard interrogations, during which he fainted at least 27 times. If you are working in China, or you have staff who are, you may want to factor this type of treatment into your risk rating for engaging in business in China, where your company maintains an office, and staff, there. If you have never been interrogated, it is not an experience that I recommend, unless you have a very strong personality, and the ability to stand up under pressure.

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