SZ DJI Technology Co., Ltd, more popularly known worldwide as DJI, has established a special anti-corruption group to conduct in-depth investigations of employees that defrauded it of more than RMB1 billion ($150 million) in a scandal that has stunned China.
This case is one of the largest cases of graft among China's technology firms. DJI employs 14,000 people worldwide and is based in Shenzhen.
DJI is the world's leading commercial and civilian aerial drone manufacturer. It commands more than 70% of the global aerial drone market. Its drones are used by the music, television, advertising and film industries, among many others.
The scandal that involves massive kickbacks and fraud is expected to include more than 100 employees. Of this total, 45 DJI employees are already under investigation for alleged fraud.
DJI said many of those involved -- most of whom worked for its supply chain units -- will face jail sentences. The initial investigation is just "the tip of the iceberg," said a DJI spokesperson. It is unclear if all of those involved in the corruption scandal work in China or in other countries.
In an internal memo, DJI said it had fired 29 employees while 16 were reported to the police. It said the employees in question fraudulently inflated the prices of parts bought from suppliers for personal financial gain. These employees also received kickbacks from suppliers that charged double or triple the prices of parts they sold to DJI.
"DJI will not tolerate corruption because of the rapid development and will not stop its development because of corruption," said a DJI spokesperson.
DJI is still looking into the scandal, which it described as extensive and involving large sums. Legal analysts said the case exposes a huge lapse in DJI internal controls.
In a statement, DJI said it is taking steps to strengthen internal controls and has established new channels for employees to submit confidential and anonymous reports relating to any violations of the company's workplace conduct policies.
"We continue to investigate the situation and are cooperating fully with law enforcement's investigation," said the spokesperson.
DJI is the latest big-name Chinese tech firm to be wracked by a corruption scandal. Didi Chuxing Technology Co, China's largest ride-hailing firm, recently uncovered more than 60 cases of corruption in 2018.
The former president of Alibaba's video-streaming platform Youku, Yang Weidong, was forced to resign and was placed under investigation in December 2018 on suspicion of accepting improper payments.
