A human resources manager in China has been sentenced to over a decade in prison for exploiting a loophole to hire fake employees and steal their wages. The scheme, which lasted eight years, is detailed in a White Paper on duty-related crimes.
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In 2014, Yang, an HR expert, joined a Shanghai-based technology company. Yang oversaw payroll and handled the hiring and resignation processes across various departments, per Unilad. As the only person responsible for these tasks, Yang quickly realized there was little oversight, according to the White Paper released by the People's Procuratorate of Minhang District.
Yang exploited this gap by creating fake employment records for 22 non-existent workers. He added them to the company's payroll system and diverted their wages into bank accounts he controlled. Over eight years, Yang stole more than 16 million yuan (roughly $2.2 million) in wages and severance pay.
Manager Gives Fake Identity
The fraud continued undetected until 2022, when employees began raising concerns. Finance staff flagged a suspicious name -- Xiao Sun -- a "team member" who had a perfect attendance record but was never seen in the office. Investigators uncovered that Xiao Sun and 21 other employees were entirely fictional.
The investigation revealed that Yang had been stealing company funds for years. The Minhang Procuratorate froze all bank accounts linked to the transactions. Yang was ordered to repay 1.1 million yuan ($152,000), with his family contributing an additional 1.2 million yuan ($165,000). However, this amount was only a small fraction of the 16 million yuan stolen.
Per Unilad: "It was also found that Yang had been syphoning money out of the company and into their own hands, causing the Minhang Procuratorate to intervene and lock down all bank cards in the transaction chain."
Yang was convicted and sentenced to 10 years and two months in prison. He also lost his political rights for one year and faced an embezzlement fine. This news is yet another example of the dangers of unchecked authority in corporate settings.
