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在线翻译:
szdaily -> Opinion -> 
Nepotism not a Chinese patent
    2016-12-26  08:53    Shenzhen Daily

    Winton Dong

    dht620@sina.com

    AFTER more than three years of a lengthy tug of war, JP Morgan Chase & Co. has recently reached an agreement with the U.S. regulatory authorities to settle a federal investigation into its hiring practices in China by paying reconciliation fees as high as US$264 million.

    Of the total amounts, US$130 million was given to the U.S. Securities and Exchange Commission (SEC), US$72 million and US$62 million were given to the U.S. Justice Department and the U.S. Federal Reserve respectively. It is said that no individual involved in the case will be criminally charged after the company pays the penalties.

    JP Morgan was probed and punished by U.S. authorities because of its hiring of 222 well-connected Chinese employees, the children or family members of high-ranking Chinese government officials and executives of State-owned companies in the hopes of currying favor in winning more business from the Chinese market.

    Such a malpractice, internally known as the Program of “Sons and Daughters” within the company of JP Morgan, was said to run from 2004 to 2013, a decade-long boom for Chinese Initial Public Offerings (IPO). According to the U.S. regulatory document filings, nine out of the 12 large Chinese companies that JP Morgan took public in Hong Kong during the past decade — which means three-quarters of the listed companies undertaken by JP Morgan — were involved in the so-called “Sons and Daughters” Program.

    The Wall Street Journal has also previously reported that JP Morgan hired the children of several powerful Chinese officials, who were apparently or totally unqualified for their posts. Most of the job vacancies provided by JP Morgan for the well-connected individuals were in the Chinese mainland and Hong Kong.

    In 2013, U.S. federal authorities began to investigate the hiring practices of JP Morgan and alleged that such a hiring program violated the U.S. Foreign Corrupt Practices Act, which sets penalties for companies that use inducement to win business from government officials. The law, enacted in 1977, makes it illegal for U.S. companies to make any valuable exchanges with the officials of foreign countries in return for an unfair advantage in business.

    Frankly speaking, every candidate in the job market should be fairly and objectively treated. So it doesn’t necessarily mean that those foreign companies cannot hire qualified family members and friends of Chinese decision-makers. Attorneys of JP Morgan also disputed what conduct could be considered corrupt from a legal standpoint in countries like China where it is common to employ powerful individuals. However, according to the U.S. law, hiring someone with connections to the government or State-owned enterprises with the purpose of winning business is itself a violation of law.

    People familiar with the matter said that the final settlement of the JP Morgan case would pave the way for similar outcomes in ongoing inquiries into other banks. According to the U.S. federal regulatory filings, Citigroup, Credit Suisse, Goldman Sachs, HSBC, Morgan Stanley, Bank of New York Mellon and some other famous names in the global financial sector are also included on the investigation list.

    It is really a satire that while China is trying its best to get rid of such a bad habit as nepotism, some influential and pace-setting Western companies are taking advantage of it as a special weapon to edge into the Chinese market.

    Despite the fact that no individual will be criminally charged in the JP Morgan case according to American law, the Chinese discipline inspection watchdog should still look into the details of the case to see whether JP Morgan’s hiring practices were linked to deals subsequently won by the bank, possible piping of economic interests and even possible leakage of national secrets.

    Moreover, with the case as a beginning, Chinese authorities should also strongly push the enforcement of anti-corruption law into more gray areas to deter the wonton actions of those government officials and executives of State-owned companies.

    (The author is the editor-in-chief of the Shenzhen Daily and guest professor of Shenzhen University with a Ph.D. from the Journalism and Communication School of Wuhan University.)

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