Crypto News

Director of Listed Chinese Company Embezzles $8 Million, Uses Funds to Purchase Bitcoin Mining Rigs2 min read

Jun 7, 2022 2 min

Director of Listed Chinese Company Embezzles $8 Million, Uses Funds to Purchase Bitcoin Mining Rigs2 min read

Reading Time: 2 minutes

A Chinese prosecutor is reported to have given a thumbs up to the arrest of a listed big data company director accused of embezzling $8 million and using the funds to buy bitcoin mining rigs. Although Li Qunnan has denied the allegations, executives insist their evidence implicates him.

Director’s Unsanctioned Use of Funds Discovered in November 2021

A prosecutor in Beijing, China, has reportedly approved the arrest of a former director of a listed big data firm who is accused of using fraudulently acquired funds to purchase bitcoin mining rigs. According to the company’s filings with Shanghai Stock Exchange, the director, Li Qunnan, is alleged to have embezzled about $8 million (55.53 million yuan) from Zhongchang Big Data.

As per one Chinese language report, Qunnan, a former chairman of Zhongchang Big Data, is thought to have misappropriated funds during his tenure as a senior executive of the company. Zhongchang Big Data claimed it only became aware of the director’s unsanctioned activities in November 2021 when the company’s new management carried out an “inspection of the subsidiary companies to standardize the corporate governance.”

After the inspection outed Qunnan as the culprit that had been misappropriating funds, the former director is reported to have sent a statement to Zhongchang executives in which he denied the allegations.

Company Funds Used to Pay for Hosting Fees

However, despite Qunnan’s denial, Zhongchang executives have insisted that he is the culprit and have produced evidence to support their assertion. For instance, the executives allege that between January to September 2021, their company paid for “servers” worth $4.1 million, but these do not appear in its books. Upon inspection, the servers were found to be “Whatsminer mining machine (model: M31S-76T44W), supercomputing server (model S10Pro),” the report said.

Besides paying for the bitcoin mining machines, Zhongchang claimed the former director also used the company’s funds to pay for the hosting fees which totalled $3.8 million.

Meanwhile, the report said Qunnan has refused to cooperate with investigators and is currently thought to be out of the country.

What are your thoughts on this story? Let us know what you think in the comments section below.

Your email address will not be published. Required fields are marked *