Preventing Fraud in China: Listen to Whistleblowers

Have you uncovered fraud or corruption issues within your company in China? Are the numbers not adding up?

Compliance breaches continue to be a widespread and costly reality for businesses operating in China. Read on to find out how others are facing up to the challenge and to learn about our Whistleblower System – an easy-to-implement solution that Fiducia recently launched to meet clients’ needs.


What types of fraud are the most common in China?

  • Manipulation of financial data
  • Conflicts of interest, e.g. when hiring personnel or choosing vendors
  • Bribery
  • Asset theft
  • Intellectual property theft

Why are companies upgrading their compliance programs?

  • To ensure compliance with China’s stricter anti-corruption rules.  The revised Anti-Unfair Competition Law adopted in 2017, for instance, categorizes more types of behaviour under “commercial bribery” and gives authorities greater power to investigate and punish violators. 
  • To increase  transparency between a company’s overseas headquarters (HQ) and China subsidiary. Strong compliance controls give HQ the confidence to shift more decision-making power to China, which unlocks agility and efficiency.
  • To gain the trust of business partners and clients by demonstrating a culture of transparency and integrity can be a key differentiator
  • To mitigate the ever-higher reputational risk of non-compliance in today’s hyper-connected world

Anti-fraud strategies

In order to be effective, internal compliance measures must be tailored to your company’s relevant fraud risks, organisational structure, and resources.  The two strategies below, which often go hand in hand, have helped many of our clients identify risk areas and implement targeted, and therefore cost-effective, solutions:

  • Whistleblower System: A web-based Whistleblower System provides a secure and effective channel for employees and third parties to report incidents and risks that would otherwise be hard and costly to discover. 
  • Health Check: A tailored audit can be carried out by experts to reveal compliance breaches/risks in the legal, financial, or operational areas of your China business.  identify ways of addressing them. 

Get in touch with our compliance experts to discuss your concerns and evaluate fitting strategies to ensure internal compliance.