Indonesia Triggers Interpol Red Notice in Search for Sinopec Executives Accused of Fraud
On March 21, Interpol issued “Red Notices” for three Sinopec executives (Zhang Jun, Feng Zhigang and Ye Zhijin) suspected of fraud in relation to their work on the $800 million West Point Oil Terminal Project in Indonesia. The three executives were working for Sinopec’ subsidiary, Sinopec Kanton Holdings. Jun was the project’s finance director, Zhigang its Chief Executive and Zhijun the project Chairman. It is believed that the three officials have already fled the country. This is the second major Chinese oil firm in the past three years to face corruption allegations in Indonesia, the other being CNPC in its acquisition of the Limau oilfield. CNPC was supposed to boost the field’s production, but never actually implemented such measures.
The Indonesian government originally filed a request for assistance from Interpol on February 21, accusing the three executives of embezzling an undisclosed sum from the West Point project. PT Mas Capital Trust (MCT), a minority stakeholder in the project, initiated the investigation into Chinese fraud in 2015. Work on the West Point Project was originally supposed to be completed in 2016, but faced delays caused by dwindling demand for tank storage capacity and a lawsuit from Indonesian investors. As of this writing Sinopec maintains that it “has not received any red notices from Interpol” and that its subsidiaries “operated in accordance with the law.”