China witnesses rise in fraud
(Reuters)Updated: 2006-11-23 20:31
BEIJING - China saw nearly a 10 percent rise in economic crimes so far this year, the Ministry of Public Security said on Thursday, warning that the trend could lead to social instability.
 Zhang Enzhao [newsphoto/file]  |
Economic crimes "could trigger social instability and impede economic security of the country," the Xinhua news agency quoted Gao Feng, a ministry official, as saying.
Analysts say economic crime in China scares away foreign investors and could hinder domestic investment and savings.
Several Chinese banks have also reported cases of embezzlement and fraud this year, and earlier this month a former head of China Construction Bank -- one of China's "Big Four" state banks -- was jailed for 15 years for taking bribes to arrange loans.
Gao said police uncovered 1,500 cases of pyramid selling this year, involving $640 million worth of goods
Pyramid selling is illegal in China, where the government fears the schemes, which seek to envelop a widening network of people who pay to participate, could trigger unrest when the pyramids collapse.
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