Bank of China(BOC) spokesman Wang Zhaowen announced on Monday January 31, 2005 that investigations as to the fraud case of Heilongjiang Hesongjie Sub-branch has been going on. According to estimation, it is a case suspected of an instrument fraud with outside collusions, involving up to several hundred million yuan of deposit of the Northeast Expressway Co. Ltd. and other firms. The former head of the Hesongjie Sub-branch, Gao Shan has been suspected to be involved in the fraud. Police has begun investigating the case.
The BOC Heilongjiang Branch reported to the police at the first time. The BOC Head Office (H.O.) has attached great importance to the case, and reported it in no time to the China Banking Regulatory Commission and other relevant authorities, as well as dispatching a team to Heilongjiang for supervision of the provincial branch in making the inspection, account checking and process examination. Bank of China President Li Lihui had a special trip to Harbin to direct the dissection of the case and the study on improvement measures. Special meetings have been convoked and discussions been made in H.O. with outside auditors. Distilling the experience of overseas banks in fraud cases, the Bank is making detailed measures in dealing with the case and strengthening internal control.
According to the present investigation, it has not been found as yet that other branches of the Bank are involved in the case.
Along with assisting the police, the Bank has decided to take the following measures:
Firstly, set up a special team of the bank’s business experts and outside auditors, taking charge of the case inspection, account checking and process examination.
Secondly, probe into this and former cases, fully analyzing the weaknesses in management and internal control, improving the business process, management process and the frame network, consummating the internal control system and anti-risk measures, tightening the accountability system and dealing with the involved person sternly.
Thirdly, launch a full inspection and audit into each of the key positions, key links and key businesses of all business branches of the Bank.
The spokesman said the Bank would disclose in time the relevant information of the case according to the investigation.
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