Core Points - A livestock company, Inner Mongolia Green Company, was involved in a loan fraud case where it pledged 800 tons of "beef and lamb" to a bank, which turned out to be water-injected duck meat [2][8] - The company's legal representative, Hu Guodong, was sentenced to 15 years in prison for loan fraud and contract fraud, causing significant financial losses to the bank and local farmers [2][7][12] - The case highlights severe deficiencies in the bank's due diligence and oversight processes, particularly regarding the verification of pledged collateral [11] Company Overview - Inner Mongolia Green Company is located in Abaga Banner, specializing in the slaughter, processing, storage, and sale of beef and lamb, with an annual production capacity of 6000 tons [5][15] - The company was once recognized as a leading poverty alleviation enterprise in Inner Mongolia and actively engaged in social responsibility initiatives [15][16] Fraud Details - Hu Guodong utilized a loan product called "Warehouse Financing" from Xilin Gol Rural Cooperative Bank, pledging livestock as collateral while actually using duck meat [8][9] - The fraudulent activities included misrepresenting the quality and type of pledged meat, leading to a loss of approximately 39.86 million yuan for the bank [9][10] - The company had been in financial distress, accumulating debts exceeding 57 million yuan, while continuing to mislead farmers into selling livestock under false pretenses [13][17] Legal Proceedings - The court found Hu Guodong guilty of multiple counts of fraud, resulting in a combined sentence of 15 years and fines totaling 200,000 yuan [7][12] - The case has raised concerns about the effectiveness of third-party supervision in the banking sector, as the bank relied heavily on external companies for collateral verification [11][14] Market Impact - The assets of the Green Company, including slaughtering and freezing equipment, have been auctioned multiple times, with no buyers, reflecting the company's deteriorating market position [3][5] - The case serves as a cautionary tale for financial institutions regarding the importance of rigorous asset verification and ongoing monitoring of borrowers' financial health [11][18]