China launches anti-corruption campaign in financial sector by inspecting banking regulator

BEIJING, Oct 12 (Reuters) – China’s top anti-corruption watchdog has launched a roughly two-month inspection of the country’s banking and insurance regulator, part of a wider campaign to to eliminate corrupt Communist Party officials in the financial sector.

The Central Commission for Discipline Inspection (CCDI) is deploying teams to 25 financial institutions including the central bank, stock exchanges, banks and wealth management companies, with instructions to focus on their Party committees.

A statement released late Monday by the China Banking and Insurance Regulatory Commission (CBIRC), the first institution to come under scrutiny, said inspectors would look for any violations of political discipline – an understatement of the Party for corruption.

“Finance is at the heart of the modern economy and is linked to development and security,” Yang Guozhong, CCDI inspection manager, was quoted in the statement as saying.

“Inspections are political supervision and a powerful and comprehensive way to strictly govern the Party,” Yang said.

“There must also be no systemic financial risks – this is the bottom line that we must resolutely defend,” he said.

In late September, China’s top anti-corruption official Zhao Leji called for a thorough inspection to uncover policy deviations within Party organizations, as well as issues affecting the development of the financial sector. On Monday, the CCDI said the former chairman and Party chief at Chang’an Bank, based in northwestern Shaanxi province, had been expelled from the Party and public office over corruption.

Chinese President Xi Jinping is reviewing ties state banks and other financial institutions have developed with large private companies, The Wall Street Journal reported Monday, citing people with knowledge of the plan.

In recent months, Chinese regulators have targeted sectors ranging from technology to education and real estate, targeting some of the country’s biggest companies like Alibaba Group and Tencent Holdings. (Reporting by Ryan Woo; Editing by Simon Cameron-Moore)

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