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Ex-COSCO boss facing graft charges

Xu Minjie, the former deputy general manager of China’s state-owned shipping giant China Ocean Shipping Group Co. (COSCO), has been expelled from the communist party while awaiting corruption charges, in a sign that China’s anti-graft campaign has spread into the shipping industry.
 
The Central Commission for Discipline Inspection (CCDI), the party’s top anti-corruption agency, said Xu had taken advantage of his position to falsely claim personal expenses from company.

The CCDI didn’t specify how much Xu fraudulently claimed. Local magazine Caixin said the claims amounted to about $1 million. Other other media reports said Xu’s illicit assets include 38 properties and over $9 million in cash.

Xu, pictured above, was placed under investigation in November last year after resigning from his post as deputy president of China International Marine Containers (Group) Ltd, a subsidiary of COSCO.

An audit in 2011 discovered illegal operations and accounting fraud in COSCO’s container leasing unit – Hong Kong-based Florens Container Holdings Limited. Hong Kong’s anti-graft agency handed over the audit report to mainland’s judicial authorities, triggering the investigation into Xu’s misconduct, according to sources with knowledge of the matter.

Xu was said to have close ties with the recently retired COSCO Group chairman Wei Jiafu. Wei has reportedly been barred from leaving China, a rumor COSCO has denied.

Xu’s expulsion from the party came after several COSCO executives were placed under investigation for graft. In July last year, the former general manager of COSCO Dalian Ocean Shipping Co., Meng Qinglin, was detained for questioning over alleged corrupt vessel-leasing deals. In 2012, former general manager of Guangzhou Ocean Shipping Co Ltd, Xu Huixing, was arrested for taking over 2.4 million yuan ($385,350) in bribes.

Sources: Wall Street Journal, Beijing Times (京华时报), Caixin (财新网)

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Hui Zhi is the Senior Manager for Content with the China Compliance Digest, where a version of this post first appeared.

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