British consultant detained in China's GSK probe

Peter Humphrey runs Hong Kong- based ChinaWhys, an investigation and risk consultancy that focuses on fraud and accounting for multinational businesses operating in China.

He is believed to have been a contractor for GSK and one of up to 10 individuals detained by representatives of the Ministry of Public Security, rather than Shanghai city police. The reason for his detention remains unclear, although he is understood not to have been formally arrested.

A spokesman for GSK said Mr Humphrey had "never been a GSK employee" but would not comment on whether his company had been employed as a GSK contractor.

A spokesman for the Foreign Office said: "We are aware of the detention of a British national in Shanghai, China. We are providing consular assistance to the family."

Last week, four of GSK's senior executives were arrested by Chinese police but not formally charged. Several more are under house arrest, with one British senior executive currently forbidden from leaving China.

One detainee was paraded on state television to make a public "confession" to charges of bribery. The other three have allegedly admitted to corrupt practices during questioning. Chinese police can detain people for extended periods without charge as they investigate potential wrongdoing.

Mr Humphrey is thought to speak fluent Mandarin and founded ChinaWhys with his wife, a forensic accountant. "We are international business advisers with eyes in China, walking multinationals through the labyrinth of opportunity, risk and unfamiliar cultural environment," the company's website states.

Mr Humphrey has worked for companies such as PricewaterhouseCoopers and Kroll in China, where he specialises in designing systems for multinational companies to limit chances of breaching anti-bribery laws, the Wall Street Journal reported.

In 2004, ChinaWhys and GSK organised a joint seminar in Shanghai for the European Chamber of Commerce under the theme of "tackling the risks of the supply chain shift - identifying and managing fraud, corruption and [intellectual property] risks in China".

News of Mr Humphrey's detention came as it emerged that GSK could be prosecuted in Britain over its £320m bribery scandal in China. GSK has sent files to the UK's Serious Fraud Office as the company's own inquiry into the charges widens. It is believed that the SFO has not requested information from the group, but is being kept informed by GSK management after the company uncovered evidence that appears to support some of the allegations. Sir Andrew Witty, the group's chief executive, is expected to admit "major failings" during its scheduled conference call on Wednesday.

Senior GSK executives in China are accused of an orchestrated attempt to falsify invoices, pay sweeteners to third parties and siphon off payments for their own use. Chinese authorities revealed last week that police were looking into deals allegedly worth 3bn renminbi (£320m), which could go back as far as 2007.

www.yahootrend.com