Banks' hiring of well-connected relatives in China widespread


While the SEC is only now investigating JPMorgan (JPM) for possibly hiring the children of influential officials in China to win business, the recruitment by major banks of well-connected relatives has been going on for over a decade.

Goldman Sachs (GS) once employed the grandson of former Chinese President Jiang Zemin and Credit Suisse (CS) the daughter of ex-Prime Minister Wen Jiabao. In 2006, the son-in-law of of a politburo member helped Merrill Lynch (BAC) win a deal to work on the $22B IPO of state-owned bank ICBC.

While some of the recruits work hard, others barely make it to the office. Still, regulators might find it difficult to prove a direct connection between an appointment and the obtaining of a contract.

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Comments (9)
  • Tschurin
    , contributor
    Comments (381) | Send Message
     
    This from yesterday's WSJ: "To get ahead in China, you need the right daddy.So says a recent online survey showing that nearly 84% of respondents believe the young people around them would prefer to play a game of pin die rather than work hard. Meaning something like “powerful daddy,” the phrase refers to competing on the basis of family background. By that, they mean in terms of jobs – more than 80% said they believe many young people have relied on pin die to get ahead at work. The survey was conducted by the Social Survey Center of the China Youth Daily, a state-run newspaper, and web portal Sohu.com."
    21 Aug 2013, 05:22 AM Reply Like
  • John/Jack
    , contributor
    Comments (156) | Send Message
     
    Gee, how strange. You mean that, in China, friends and family help each other -- like everywhere else in the world? If the SEC thinks hiring someone with connections is a crime, they are going to be very busy going through the entire U.S. government,
    21 Aug 2013, 06:11 AM Reply Like
  • gwynfryn
    , contributor
    Comments (6458) | Send Message
     
    Moreso in China, though, where they have much stronger family ties, and especially, a more respectful attitude towards elders, and take the strange view that family members are more trustworthy, and more likely to share one's own interests. When in Rome (or China)...
    21 Aug 2013, 06:19 AM Reply Like
  • Tricky
    , contributor
    Comments (2431) | Send Message
     
    Indeed, Wall Street hires scions of "American dynasties" for their connections in the US. Not really news.
    21 Aug 2013, 09:15 AM Reply Like
  • AchaninUSA
    , contributor
    Comments (45) | Send Message
     
    The "powerful daddy" thing works well in USofA likewise. Sometimes, it's whom you know that's important.

     

    It's another kind of "wealth".
    21 Aug 2013, 11:26 AM Reply Like
  • gwynfryn
    , contributor
    Comments (6458) | Send Message
     
    True, Ac, but in practise it amounts to the same thing; one reason I didn't go into finance may be that I grew up not even knowing a banker or trader. All I knew were farm hands and labourers, with the highest ranked being a foreman in a process factory, which pretty well set the limits to my own selection process. OK, times have changed (no television for me, back then) but who you get informed by, during your development, is still a big influence; after all, this is how dynasties form in the first place!
    23 Aug 2013, 08:47 AM Reply Like
  • bernie 1
    , contributor
    Comments (673) | Send Message
     
    Shocked,shocked, that gambling is going on. Anybody remember Casablanca? It really is amazing that our government agency's think that they can force the world to our alleged standards. Trust me,it's not just Wal-Mart paying off in Mexico, or hiring the children of connected in China. This is how the rest of the world does business. I remember going to Bali, Indonesia some years ago & was introduced to American manufacturers there. I asked is it difficult to build a business there & then send the product to the states. To a person, I was told there was never a problem because EVERY foreign business in Indonesia has to have a citizen of Indonesia as a partner. Yes you guessed it, the partner had a family member in government. Wake up Washington, it's the way it's done, as if you all have never met an senior person in our government with a son,daughter or whomever working in the same area.
    21 Aug 2013, 08:47 AM Reply Like
  • P. Dennis
    , contributor
    Comments (399) | Send Message
     
    I'm going to my library to read that old paperback copy of "The Ugly American".....again.
    21 Aug 2013, 11:00 AM Reply Like
  • outofhere
    , contributor
    Comments (3694) | Send Message
     
    Remember old mayor Richard J Daley of 1968 fame.
    his son William worked for a number of financial firms,
    he was and is a lawyer. During his association with Amalgamated
    bank of Chicago he was sent to Chase for training. Later when he got a second run with Chase via Bank One he was called Howdy Doody behind his back a great front man with a head of wood.

     

    If they fire all the people employed in the front office of a bank because of friends and family about 85 % are gone. During my career we hired this young kid who had an accounting degree and his father was an EVP for our clearing bank in Chicago. Everybody felt he was being given a free ride. Three years later when he left to go back to Chicago everyone knew we were losing a top notch accountant.
    24 Aug 2013, 09:58 PM Reply Like
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