A manager in China took advantage of a loophole in the human resources management system to create 22 'ghost' employees and embezzled up to 2.2 million USD over 8 years.
A human resources manager in China created 22 "ghost" employees to embezzle $2.2 million in salaries from the company - Photo: SCMP
According to the South China Morning Post on March 12, a human resources manager at a labor supply company in Shanghai, China was prosecuted for embezzling $2.2 million over eight years in an unexpected way: creating "ghost" employees.
This manager, surnamed Yang, was responsible for managing employee payrolls. After discovering that he had complete control over personnel management without supervision or control, he began to embezzle.
Yang first created a fake employment record for an employee surnamed Sun, then submitted a salary claim for the employee. When he received the money, he transferred it to a bank account he controlled but not in his name to avoid detection.
Realizing that the company did not thoroughly review its payroll process, he continued to expand his plan by creating 21 more "ghost" employees.
From 2014 to 2022, he repeatedly falsified timekeeping records and payslips, thereby embezzling huge amounts of salary without arousing suspicion.
When the company noticed that the salary had not been transferred to Sun's employee account, Mr. Yang claimed that the technology side had delayed the payment.
It wasn't until 2022, when the tech company's finance department discovered an anomaly — Sun employees were showing up regularly and receiving their salaries on time but never showing up at the office — that they began investigating.
The incident was quickly reported to the authorities, leading to the exposure of Mr. Yang's entire eight-year fraud.
After investigation, Mr. Yang was sentenced to 10 years and 2 months in prison for embezzlement, deprived of political rights for one year and had to repay the entire amount.
He was also fined 1.1 million yuan ($152,000), and his family was also ordered to pay an additional 1.2 million yuan.
The incident caused a stir on Chinese social media. Many people expressed outrage at Mr. Yang’s audacity, criticizing him for embezzling such a large amount of money while many employees were actually struggling because of unpaid wages.
Some comments also criticized the company for having a huge loophole in its payroll management system, creating conditions for fraud that lasted for many years.
Many unexpected embezzlement cases
In fact, cases of abuse of power to commit crimes are not rare in China.
Previously in December 2024, a woman in Shanghai also embezzled 4.5 million yuan (620,000 USD) of public funds to spend lavishly after her divorce.
Or an accountant in Shanghai who listed her 9-year-old son as a construction contractor and defrauded him of more than 22 million yuan ($3 million) in wages.
Source: https://tuoitre.vn/nguoi-dan-ong-trung-quoc-tao-22-nhan-vien-ma-bien-thu-2-2-trieu-usd-20250312164339389.htm
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