Home > Uncategorized > Morgan Stanley acts over possible China corruption

Morgan Stanley acts over possible China corruption

Morgan Stanley is very active in the China property market, holding roguhly one-third of thier real estate assets in Asia.  The company was one of the first to tap into the real estate market in China and since has raised a lot of money and done great projects.  China is known for it’s corruption and bribery in real estate markets.  Shanghai former mayor Chen Liangyu, was arrested in 2006 for corruption that was partly related to property deals.  Consulting firms offer perferential treatment in bids for land and projects in exchange for large consulting fees.   

Morgan Stanley Real-Estate in China is being investigated for possible corruption and bribery.  The top property deal-maker in China was fired by Morgan Stanley during the investigation after filling showed him in violation of the foreign corrupt practices act, a US law that prohibits corporate bribery.  Morgan Stanley refuses to comment on the case except for saying it has “terminated the employee””  involved the the SEC reports. 

Morgan Stanley holds $26.5bn of their $91.3bn of real estate assets in Asia.  Asia is known for it’s “unique” business practices.  The company reportly fired the employee that was involved in the violation of the law, but it leaves you to think about if the company actually knew the entire time about the illegal business tranaction taking place, after all one-third of their assets are in Asia.  Morgan Stanley should have some sort of idea about the chinese customs to business.  Not only was this action unethical it was also against the law. 

http://www.ft.com/cms/s/O/d1562984-f96f-11dd-90c1-000077b07658.html?nclick_check=1

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Categories: Uncategorized
  1. twking13
    August 31, 2009 at 7:03 pm

    If you lay down with dogs your likely to wake with fleas. This article portrays a long history of and ongoing corruption in the Chinese real estate market. This corruption is very evident locally and abroad. With this being said my ethical concern is how could any company believe that it could enter a forgein market full of corruption. And have any chance for success without the intentions of participating first hand or tacitly through an actor of the company in such behavior. Garth Peterson and his firing and following investigation by the SEC in relation to alleged violations of the Forgein Corrupt Practices Act is the topic of this article. This concerns me because the big picture of Morgan Stanley as a company and their responsibility of ensuring through some sort of oversight, that actors of their company are following company guidelines with respect to ethical behavior is not addressed. It seems to me that someone either in accounting or some position in management must have at the very least questioned themselves as to why the same consulting firms were repeatedly receiving there business. This consulting firm corruption actual reminds me of a situation in the US.

  1. October 31, 2011 at 7:12 pm

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