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Shanghai detains 22 executives in shady deals probe

Shanghai authorities have detained 22 company executives, some working for major multinationals such as McDonald's and Whirlpool, in connection with a bribery investigation, local reports said yesterday, citing a police notice.

The probe comes amid a wider crackdown on economic crimes and a city-wide probe into corruption allegations against top city leaders that resulted in the ouster of Shanghai's Communist Party secretary, Chen Liangyu (陳良宇).

The police notice was sent to local media by the Shanghai General Team of Economic Investigation and reported in several state-run newspapers including the Shanghai Youth Daily and Xinmin Evening News.

Bribes

It said local computer network operators allegedly gave bribes worth 4 million yuan (US$514,000) to seven companies in return for equipment orders.

The reports did not name the suspects, but said those accused of taking bribes headed the information technology departments at the local offices of US consulting firm McKinsey & Co, Swiss engineering firm ABB Ltd and US appliances maker Whirlpool Corp, among other companies.

Police would not immediately comment on the report and requested questions in writing.

A McDonald's Corp spokeswoman said she was checking into the report. Staff at ABB's headquarters in Beijing also had no immediate comment. A phone operator at Whirlpool's Shanghai office said the company would not accept any interviews.

Response

McKinsey issued a statement saying "we are not aware of any information other than that printed in the press. McKinsey has not in any way been accused of any bribery or corruption."

Staff at McKinsey's Shanghai office declined further comment.

The reports in the media provided only false names for the suspects detained. They said that investigators had recovered 944,400 yuan of the money allegedly offered as bribes.

According to the state-run newspaper Shanghai Daily, investigators were tipped off by an anonymous caller claiming that a manager at a local computer company had allegedly bribed two information technology staffers at McKinsey's Shanghai office.
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