Top energy head faces probe for bank fraud

Top energy head faces probe for bank fraud

China has started criminal investigation into its top energy administrator for fraudulently trying to arrange a bank loan for a businessman after a journalist blew the whistle on the scandal on the Internet.

"Relevant departments of the central government have launched a criminal investigation in response to my whistleblowing," Luo Changping, deputy managing editor of Caijing magazine, wrote on his twitter-like Sina Weibo yesterday.

In a weibo post on December 6, Luo claimed that Liu Tienan, head of the National Energy Administration, helped to arrange US$200 million in bank loan for businessman Ni Ritao.

Ni sought the loan from two Chinese banks, claiming that the money would be used for the acquisition of New Skeena, a Canadian pulp mill - which he had already bought.

The attempt to get loan nearly succeeded and Liu's family had reportedly received kickbacks from Ni.

The National Energy Administration issued denials on December 6, slamming Luo for "pure slander."

But the administration was criticized for being quick to deny the allegations, especially as it targeted an individual and not the company.

The NEA is under the National Development and Reform Commission, China's top planning agency, of which Liu is also a vice director.

Luo also alleged in yesterday's post that Liu had forged his academic credentials and sent death threats to his mistress after their love went sour when he served in the Chinese Embassy in Tokyo in the late 1990s.

Luo said yesterday he had been assisting authorities with the investigation for the past weeks and won't be making any further comments before an official announcement is made.

Liu was in Moscow with Vice Premier Wang Qishan for an energy conference when the scandal first broke.

He has since carried on with his work, delivering a speech at the annual national energy work conference earlier this month.

The National Energy Administration wasn't available for comment yesterday, nor was the Central Commission for Discipline Inspection, the Communist Party of China's graft-battling body which is headed by Wang.

Liu was appointed director of the NEA at the end of 2010.