Shanghai Finance


CBRC fines 19 banks in loan fraud case

February 05,2018


China’s banking regulator has imposed a fine of 52.5 million yuan (US$8.33 million) on 19 banking institutions involved in a pledge loan fraud case in Shaanxi and Henan provinces.

These lenders, including local branches of the Industrial and Commercial Bank of China, were punished for granting loans of up to 19 billion yuan to criminals who illegally used low-purity gold as pledges, the China Banking Regulatory Commission said.

The loan fraud case has exposed “numerous defects” in the internal controls and management of these institutions, which sought business expansion aggressively and blindly, “creating loopholes that criminals can exploit,” the regulator said in a statement.

A total of 104 employees in the banking institutions were also punished, while 35 criminals involved in the case have been arrested, the CBRC said.

China has been intensifying regulatory scrutiny on lending activities to rein in financial risks. Only a week ago, 12 banks were fined 295 million yuan.

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