DJI to Lose Nearly $150 Million Because of Employee Fraud
The Chinese drone manufacturer, DJI, has discovered that it stands to lose almost $150 million as a result of several cases of fraud caused by its own employees. Said employees were reportedly inflating the costs of drone parts in order to line their own pockets with the added money.
DJI is the world’s largest drone manufacturer and employs over 14,000 people. In its statement, DJI says that it took swift action to address this issue, dismissed a number of employees who violated company policies, and contacted law enforcement officials.” While DJI’s investigations are still ongoing, up to 29 employees have been let go already as a result of the investigation’s findings, and 16 more are still alleged to have been involved in the fraud. These numbers may rise as the company continues their investigation in hopes of weeding out any other employees who either directly committed fraud or were complacent in it.
Following a country-wide crackdown on corruption in 2012 by Chinese President Xi Jinping, many companies in China have been working diligently with authorities in order to investigate and remove any signs of corruption throughout their company. In particular, President Xi Jinping has been targeting some of the biggest companies in China with his anti-corruption campaign and many tech giants have been complying.
DJI currently controls around 74 percent of the total drone market, which is estimated to be worth about $9.3 billion. These numbers certainly make DJI a pretty high priority for President Xi Jinping’s anti-corruption methods.
The news of DJI’s employee fraud was originally spread through Chinese social media as a result of an internal notice that was leaked online. Word quickly spread about employees within the company’s supply chain that were engaging in “corrupt behavior” that caused their prices to increase. With the Chinese government’s focus on eliminating corruption within large companies, this became a cause for concern and the company began taking action to rectify this newly discovered case of fraud.
Although it may be the latest company making the news, DJI isn’t the only big-name company in China that is having to fire employees for being involved in various cases of corruption. Several other companies have been undergoing investigations of their own in compliance with the Chinese government’s attempts to weed out corruption. This includes ByteDance, a startup worth $75 billion, that has been undergoing an investigation into bribery and has already turned over two employees to authorities. They discovered that some of their employees, such as an executive identified only as Wang, had been taking bribes from business partners.
Similarly, last month, Alibaba had to fire the president of its video streaming platform, who is also now under investigation for corruption and, more recently, Chinese ride-hailing company, Didi, had to fire over 80 employees as a result of their attempts to crack down on corruption in their company. According to Didi, the employees that they let go of were engaging in either “fraud, profiteering, or violating information security regulation.”
By SoftActivity Team