(Yicai Global) Feb. 14 -- A futures trader at Jinzi Ham, who closed hog futures contracts without authorization leading to losses of CNY55.1 million (USD8.7 million), has been asked to leave his position, the Chinese meat processor said on Feb. 12. This is despite the trader having paid back most of the amount squandered with the help of his father-in-law.

Distressed by the plunging price of pig futures, the futures trader sold 902 hog contracts in September last year without consulting the company’s decision-making team and is being held personally liable, the Jinhua, eastern Zhejiang province-based company said at the end of last month.

His father-in-law, who holds a 3.45 percent stake in Jinzi Ham and is also the brother of the former chairman Shi Yanjun, has helped him repay CNY47 million.

Jinzi Ham admitted that there are problems with its internal control system, including the mismatch between futures and current contracts, accounting errors as well as delayed information disclosure and that internal supervision should be strengthened.

The company needs to limit the authority of futures traders, strengthen the supervision of futures accounts and conduct regular reconciliations so as to detect abnormal and illegal transactions in a timely manner, Pan-China Certified Public Accountants said.

Editor: Kim Taylor