BEIJING – While leading red circle law firm Lehman, Lee & Xu has built up a strong reputation in the fields of Intellectual Property and Mergers & Acquisitions, the firm also plays a key role in combating corporate fraud. “Every year billions are lost through corporate fraud,” relays Edward Lehman, managing director of the firm, “and unfortunately a lot of is due to carelessness.”
Many people in business who were used to meeting targets in the boom years are now feeling pressure to achieve the same levels in spite of the downturn. “This, unfortunately can lead to fraud” states Lehman, long time China resident and Sinologist.
During the boom years businesses were successful in spite of corporate fraud. Now however businesses are suffering because of it, with recent surveys showing that fraud is a real concern for over 60% of senior managers in China. “Its only natural to worry about receivables during tough economic times. The last thing businesses want though is to be worried about fraud”.
In an effort to help its clients cope with the problem the firm has began giving seminars on how to avoid fraud and the legal recourse available where business managers find themselves victims. “Forewarned is forearmed in these situations” says Lehman who has been advising companies on best business practices for over two decades. “Senior managers need to have an awareness of potential red flags”. Such flags are not just related to the behavior but also to business partners and suppliers. “What makes it so difficult to combat corporate fraud is the many forms it comes in”.
Although more prevalent in tough times Lehman is under no illusion as to the route cause of the problem. “The combination of greed and carelessness is at the root of most fraud. When you look at the Bernard Madoff scandal, it was the history of poor oversight which allowed the scheme to continue for so long” notes Lehman.
