Risk & Compliance

Sarbox, China Style

Three men, including a former accounting director, meet a dire fate after being convicted of swindling and other crimes.
Stephen TaubSeptember 16, 2004

While many finance executives no doubt regard the penalties for violating the Sarbanes-Oxley Act as stiff, they’re likely to be thankful that they’re not living in China.

Indeed, a former accounting director and at least two other employees at a bank in that country were executed after being convicted of swindling and other financial offenses, the Associated Press reported.

The dire sentences came after top justices warned of harsh penalties to combat rising economic crime, according to the wire service.

After the Supreme People’s Court upheld their convictions for fraud, the three men, Wang Liming, Miao Ping, and Wang Xiang, were executed Tuesday in central China’s Henan province, the wire service said.

Liming was a former accounting director at a branch of the state-run China Construction Bank. He and three others were convicted of luring deposits from five local government agencies with promises of high interest rates. They then stole $3.43 million by falsifying checks and money orders, according to the AP. The wire service said it wasn’t clear what sentence the fourth convicted man received.

Xiang, a former bank clerk, was also accused of committing other financial crimes, using computer scanning to falsify bank notes, and causing losses of about $2.4 million.

For the record, the maximum prison term a finance chief can get under Sarbox for such things as willfully signing off on incorrect financial statements or knowingly destroying documents in federal investigation is 20 years.