Financial Information Systems Face Integrity Risks Amid Technological Barriers

According to PANews, a recent article published on the website of the Central Commission for Discipline Inspection and the National Supervisory Commission highlights the growing integrity risks in the construction of financial information systems. The article emphasizes the increasing importance of technological regulation in the financial sector, which is complicated by high technical barriers leading to challenges in management, supervision, and accountability. The case of Yao Qian, former director of the Technology Supervision Department of the China Securities Regulatory Commission (CSRC) and former director of its Information Center, is cited as a significant example. Yao allegedly misused his position to support specific technology service providers for personal gain, abusing his regulatory powers and engaging in power-for-money exchanges using virtual currencies. The use of virtual currencies in such exchanges is a new challenge, differing from traditional assets like cash and gold. Virtual currencies are generated through cryptographic principles and exist as digital symbols, separate from the account systems of commercial banks and payment institutions. This separation allows them to bypass national foreign exchange controls, enabling cross-border exchanges with high levels of concealment, making detection and evidence collection difficult. The disciplinary inspection team at the CSRC conducted thorough political and ideological work with Yao, leading to his confession of using his position to benefit others and accepting virtual currencies as bribes. They secured crucial evidence, including hardware wallets and transaction records, adhering to electronic evidence collection protocols and conducting price evaluations to advance the case. Yao's case further underscores the significant integrity risks in the procurement and construction of information systems, characterized by high technical barriers and potential corruption in procurement processes. The disciplinary inspection team has advised the CSRC's party committee to remain vigilant about these risks and strengthen the development and enforcement of relevant systems.