China manager creates 22 fake employees with perfect attendance, embezzles US$2.2 million
He would create fake employees and employment records and apply for salary payments on their behalf - before transferring the money to a bank card he controlled.
As deepfakes become more life-like, people will find it harder to differentiate AI-generated content from reality. (Photo: iStock)
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A human resources manager in China created 22 fake employees to embezzle 16 million yuan (US$2.2 million) in salary and severance payments from the company.
The man, surnamed Yang, who worked at a labour services company in Shanghai, was responsible for managing the payroll of people sent to work at a tech company, according to the mainland media outlet Ningbo Evening News.
Yang discovered that he had sole authority over employee placement, and the labour services company had no review process for salary payments.
He then created an employment record of an employee, surnamed Sun, and applied for salary payments on Sun’s behalf.
Yang then transferred the salary to a bank card under his control, though not in his name.
When the labour services company noticed the salary had not been deposited into Sun’s account, Yang claimed the tech company had delayed payment.
Since 2014, he fabricated records for 22 fake employees, and pocketed salaries and severance pay totalling 16 million yuan. The ghost employees’ individual salaries were not disclosed.
In 2022, the tech company’s finance department noticed that Sun had perfect attendance and received timely salaries, but no one had ever seen him in the office.
The matter was reported to the authorities.
An investigation into attendance records and bank transactions revealed Yang’s eight-year ghost employee scam.
Yang was eventually sentenced to 10 years and two months in prison for embezzlement, stripped of political rights for one year, and fined. He was also ordered to return 1.1 million yuan in stolen funds, with his family returning an additional 1.2 million yuan.
With AI increasingly fuelling cross-border scams, Chinese tech firms are rolling out more anti-scam tools. Deborah Wong reports from Shenzhen.
The case, reported by mainland media in March, attracted much attention on social media.
One online observer said: “The labour service company’s payroll system had huge flaws which allowed someone like Yang to take advantage of them.”
“Yang is so bold! He stole so much money while many real employees were suffering from unpaid wages. He should be ashamed,” said another.
Reports of crimes involving abuse of job positions are not uncommon in China.
In December last year, following her divorce, a woman in Shanghai, went to a bar to find male models and spent 4.5 million yuan of public funds in just three months.
In another case, a Shanghai accountant listed his nine-year-old son as a construction contractor and defrauded more than 22 million yuan in wages by using his name.
This article was first published on SCMP.
