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Corrupt Chinese Officials Steal Billions

It seems Chinese government officials are anything but honest employees. A lengthy report that recently made its way into the media details how corrupt Chinese officials have stolen 3 billion over several years and stashed most of it in the U.

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The report claims that up to “18,000 corrupt officials and employees of state-owned enterprises have fled abroad or gone into hiding since the mid-1990s.” The PDF of the report is available in Chinese cyberspace and offers a glimpse into who was stealing money, how much they stole and how they handled their cross border money laundering.

In one case, Xu Fangming, a former Ministry of Finance official allegedly deposited roughly 1 million yuan into the bank account of a son studying abroad.

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In another, Cheng Kejie, a top politician got his mistress settled in Hong Kong and funneled money to her. Some of the stories are well known. Among the most notable is the tale of Zhang Jian, a former Communist Party chief of Haimen in Jiangsu province, who famously dumped his ill-gotten 18 million yuan into Macao casinos. According to the report, he funded his 48 visits over two years with credit cards.

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The other popular methods used for stashing stolen money include black market banking services, trade under current accounts, overseas investments, credit cards and offshore financial centers in the Caribbean and Europe.

China’s central bank has stated that it will cooperate with foreign officials.

June Issue of Risk Management Now Online

Faithful readers: the June issue of Risk Management magazine is now online. The cover story focuses on event risk management — more specifically, how music festival promoters and organizers juggle the dizzying array of risks to crowd, performers and employees during multi-day festivals. Other features explore the risks of hydrofracking and how to insure against them, how to deal with employee evacuations during political uprisings abroad and the intrinsic beauty of risk management.

Our columns explore topics such as data security in the age of WikiLeaks, the risks of China’s clean tech revolutionsignificant moments in workplace safety and the 10 worst locations for storm surge.

If you enjoy what you seen online, you can subscribe to the print edition to enjoy even more content.

Please let us know what you think in the comments below. And stay tuned to the blog for even more coverage in the future. Lastly, you can follow the magazine on Twitter“like” us on Facebook and join our LinkedIn group.

The Countries Most at Risk for Energy Security

Achieving a stable energy supply in times of political upheaval, overpopulation, dwindling traditional resources and a transition to a low carbon world is downright challenging. And for some countries that challenge seems nearly impossible, according to risk analyst firm Maplecroft, which rated the following countries at “extreme risk” for energy security:

  1. Sierra Leone
  2. Gambia
  3. Guinea-Bissau

The area is commonly known for severe political conflicts, corruption and frequent violence, which further weakens already-fragile communities and governments. In the case of the one country most at risk for energy security, Maplecroft found that:

Sierra Leone emerged from a decade of civil war in 2002 and despitereconstruction efforts and recent economic growth, it is the worst performing country in the Energy Security Index (short term). Sierra Leone was also categorized as extreme risk in the 2011 Energy Security Index (short term). Nearly 10 years after the end of the war only 10% of the country’s population has access to electricity and the supply is erratic and limited to major towns. This highlights the lasting effect that conflict can have on the energy security and infrastructure in vulnerable nations.

But these West African countries are not the only ones at risk for energy security.

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Most of the G-7 nations are included in the short-term “high risk” category, including Italy, Japan, UK, Germany, France and the USA.

The world’s second largest consumer of energy, the USA, rates as ‘high risk’ in the short-term, primarily because of the high imports of fossil fuels and electricity needed to support its colossal demand for energy. The largest percentage of US oil imports come from Middle Eastern countries – leaving the country at continual high risk of supply interruption and price shocks.

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In 2008, the US imported an average of 12.9 million barrels of oil per day, which represents 15.10% of world production in that year, with 23.36% coming from the MENA region.

Canada is the only G-7 nation rated as “low risk,” most likely because of the country’s abundant energy production and exporting business, coupled with its wealth of energy expertise, science and technology.

Japan’s ranking as “high risk” was due to many factors, including the earthquake and tsunami in March, which severely damaged the country’s ability to generate energy.

There is a silver lining, however, as Prime Minister Naoto Kan recently unveiled plans to bring down the cost of solar power generation by 2010 and to install solar panels in 10 million Japanese homes.

The Nations Most Likely to Default

This week, President Barack Obama is visiting Britain, France, Poland and Ireland, which is the first stop on his European tour and the site of a driving snafu today in which the presidential stretch, armored Cadillac got stuck on a ramp. Whoops. (See video above … via HuffPo)

Obviously, chief among the commander in chief’s reasons for talking to EU leaders face-to-face is to get a better understanding of the ongoing sovereign debt crisis in the region that is straining relations on the continent and may continue to threaten global economic recovery.

We have heard much about the so-called PIGS economies (Portugal, Ireland, Greece and Spain) — and rightfully so; Athens and Dublin in particular both have a lot of economic finagling to do to figure out some real solutions to what is a major long-term challenge for each country. And while Obama will certainly trying to be figure out what the United States can do to help smooth the austerity and economic transitions Ireland will have to make (in addition to exploring his personal roots), there are many other locations across the world with troubles of their own.

Along these lines, Business Insider ranks the 21 countries most likely to default in terms of the cost to insure each country’s debt. Here’s their list in full. Head over there for more detailed economic profiles of the nations.

21. Russia
20. Poland
19. Israel
18. Kazakhstan
17. Belgium
16. Turkey
15. Italy
14. Lithuania
13. Bulgaria
12. Romania
11. Hungary
10. Croatia
9. Spain
8. Vietnam
7. Lebanon
6. Ukraine
5. Argentina
4. Ireland
3. Portugal
2. Venezuela
1. Greece