China finds US$15b of loans tied to falsified gold deals

[BlueKelah]

This is just the tip of the iceberg. The fact it was uncovered by the national audit lends a bit of credibility to chinese government. Mainstream media is just pointing out all the Con jobs being done. Qingdao port scandal is the big one that could potentially affect confidence and also many banks involved.

[CityFarmer]

Petrochemicals, and Tianjin Port are the next targets...

Petrochemicals latest China commodity to be hit by potential fraud

03 Jul 2014 06:15
[BEIJING] Chinese petrochemical imports have become the latest commodity financing tool to come under investigation for possible fraud, highlighting the risks from the widespread use of raw materials as collateral to raise loans and skirt credit restrictions.

Commodity financing deals in China, which Goldman Sachs has estimated to be worth as much as US$160 billion, have come under close scrutiny after an alleged metal financing fraud at Qingdao Port, a huge trading hub in eastern China.

Now police in northern China are investigating another suspected fraud at Tianjin Port near Beijing, police and trade sources said, involving "mixed aromatics", a refinery product commonly used for blending petrol.

Source: Business Times Breaking News

[weijian]

Chinese Trader Said to Pledge Metal 3 Times for Loans
By Bloomberg News Jul 3, 2014 6:07 PM GMT+0800

Decheng Mining pledged the same metals stockpile three times over to obtain more than 2.7 billion yuan ($435 million) of loans in China’s Qingdao port, a person briefed on the matter said, citing preliminary findings of an official investigation.

Local authorities are checking metal inventories worth about 1.54 billion yuan including 194,000 tons of alumina, 62,000 tons of aluminum and some copper, the person said, asking not to be identified as he isn’t authorized to speak publicly. Two calls to Decheng Mining, a metals trading house based in Qingdao, went unanswered.

Foreign and local banks are examining lending linked to metals at Qingdao amid concern that risks are more widespread in China, where traders use commodities from iron ore to rubber to get funding. Steps by the Chinese government to rein in credit raised companies’ borrowing costs in recent years and triggered a surge in commodities financing deals that Goldman Sachs Group Inc. estimates to be worth as much as $160 billion.

http://www.bloomberg.com/news/2014-07-03...loans.html