China Film Group denies link to SEC probe

Corruption inquiry roils biz, social network

BEIJING China’s top biz players have rejected speculation about a link between Han Sanping, topper of state film colossus China Film Group, and a Securities and Exchange Commission probe into possible corruption in the way Hollywood does business in the booming Sino market.

A spokesman for the State Administration of Radio, Film and TV said that the group had not heard anything official about the investigation, but a spokesman for China Film Group responded angrily to any suggestions that Han might be involved.

“This is nonsense. We don’t have any response to this speculation. There is nothing to respond to,” CFG spokesman Jiang Defu told sina.com. Jiang later said: “I’ve heard nothing about this, ask whoever told you.”

CFG dominates the biz in China. It controls most productions, the facilities, the talent and it decides who makes what and when, and has a major say as to what Hollywood movies get in and why.

While CFG often acts as a funder in a traditional sense, it will, in many cases, take a stake in a project, which helps smooth the production process, but CFG will not formally buy a percentage of the movie as such. It may be this arrangement that the SEC is looking into.

China’s Weibo, the equivalent of the banned Twitter and sister service to sina.com, has been buzzing with speculation that Han is involved in some way, and it has been mentioned in industry circles.

However, Yuan Wenqiang, distribution manager for imported and exported films at CFG said, “Film distribution is a collective mechanism, it is not possible to have the opportunity for bribery.”

CFG has a stake in most productions being made, either as full producer or executive producer. Han helped direct propaganda epic “Founding of a Republic” and was involved in “Mission: Impossible III” and “The Karate Kid,” which both filmed in China.

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