CSRC Discloses Scam to Imposter CSRC
November 11th, 2003This strange notice appeared on the CSRC website recently, warning about a scam in which someone has tried to con the PRC securities industry by impostering the CSRC.
The culprit(s) apparently obtained a counterfeit seal or “chop” of the CSRC legal department, then asked listed companies, securities companies (meaning investment banks and brokerages) and fund management companies to buy various books and pay for various seminars concerning the securities industry.
One might note several interesting things here. First, the CSRC publicly disclosed this. This may or may not suggest the problem was severe (possibly there were other things going on?), but in any case I think the CSRC deserves a thumbs up for disclosing something that, even though not their fault, might be perceived as embarrassing. Hiding bad news is probably common throughout the world, but sometimes seems particularly acute in China–for example with the outbreak of SARS last year.
Also, it is interesting that the con depended on people believing the CSRC would lean on enterprises to buy books and pay for seminars. I have never heard of the CSRC engaging in such coercive extra-budgetary fund raising activities, but such tactics may be common forms of soft extortion in China. Earlier this year, a moratorium was declared on new subscriptions to periodicals and it was announced a review of government publications was underway. Apparently, many govt. entities publish newspapers (and require regulated parties to subscribe) as a fund-raising mechanism, and there was an effort to crack down on this.
In the notice, the CSRC legal department disclaims connection to these practices, announces that information concerning the scam has been turned over to prosecutors and provides a number for parties to call if they encounter any suspicious activity.
The annoucement appeared on the CSRC home page on Nov. 10, but the text of the notice is dated Nov. 6.
November 27th, 2005 at 4:55 pm
[...] Previously, the CSRC has warned that people are running scams based on impostering CSRC officers, as I wrote about here. [...]