China Probes Taiwan Staff at iPhone City for Alleged Bribery

(Bloomberg) -- Chinese authorities are investigating four Taiwanese employees at Hon Hai Precision Industry Co., Apple Inc.’s main assembly partner, for suspected criminal activities including bribery, according to Beijing’s Taiwan Affairs Office.

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The quartet were detained by the police in the central Chinese city of Zhengzhou, Taiwan’s Mainland Affairs Council said earlier this week. Zhengzhou is where Hon Hai, the flagship company of Foxconn Technology Group, operates the world’s largest iPhone assembly plant. Local media in Taiwan reported that the four Hon Hai employees were detained earlier this year.

“The suspects are being investigated by the relevant authorities over suspected criminal acts including bribery and misappropriation of funds,” Zhu Fenglian, a spokesperson for China’s Taiwan Affairs Office, said late Friday. She added that authorities are still investigating and will strictly handle the case in accordance with the law and protect the parties’ legal rights.

A Foxconn representative didn’t have any immediate comment on the TAO’s statement outside of regular office hours.

Foxconn’s iPhone plant in Zhengzhou — called “iPhone City” because it cranks out the majority of Apple’s marquee devices — is considered one of the country’s signature manufacturing projects. It employs hundreds of thousands of workers and delivers a major boost to the economy of the land-locked province of Henan.

The latest detentions came after Chinese regulators last year conducted tax audits and reviewed land use by Foxconn when company founder Terry Gou was bidding to become the leader of democratic, self-ruling Taiwan, which China sees part of its territory. Chinese tax authorities handed out a 20,000 yuan ($2,800) fine to a Foxconn subsidiary for overstating expenses. It is still unclear whether Chinese regulators have completed their probe into Foxconn.

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