Corruption in China

Dead Beijing vice-mayor blamed for $17b fraud

PUBLISHED : Monday, 01 April, 1996, 12:00am
UPDATED : Monday, 01 April, 1996, 12:00am

A total of 18.3 billion yuan (HK$17.01 billion) has been found missing from Beijing's treasury due to falsification and illegal transfers of funds by disgraced vice-mayor Wang Baosen , his successor said yesterday.

The confirmed amount contrasted sharply with the figure disclosed earlier by the authorities, who accused Wang of committing economic crimes worth only US$37 million (HK$285.86 million).

'After investigation and examination by the State Auditing Administration, the total amount of money involved in the case was put at 18.3 billion yuan,' said Vice-Mayor Jin Renqing yesterday at the Beijing Municipal People's Congress.

The legislature has been told Wang diverted some four billion yuan from the city's treasury within the first quarter of last year.

Of the total, 2.18 billion yuan was transferred from the budget to become 'funds retained in advance' on Wang's orders, Mr Jin said in his annual financial report.

Wang falsified a further 1.93 billion yuan on account by anticipating the grain income within that period, Mr Jin was quoted as saying by China-funded Ta Kung Pao yesterday.

The 800 legislators also heard that the Ministry of Finance and the State Auditing Administration had verified the amount Wang had covered up or diverted from the capital's income since 1988.

Wang killed himself in April last year while being investigated.

The corruption scandal implicated ex-Beijing party boss Chen Xitong , who was detained and stripped of his Politburo membership for allegedly covering up Wang's crimes.

'Wang Baosen's case of hiding and diverting money had a very bad influence on the state,' Mr Jin said.

The Vice-Mayor, who replaced Wang and is in charge of Beijing's financial and economic affairs, noted the authorities had been doing their best to retrieve the losses.

But Mr Jin said he had no further information on the probe into Chen or whether other sackings would follow.

The investigation was under the control of the party's Central Commission of Discipline Inspection, he said.

Reacting to questions on the admission of Mayor Li Qiyan last Friday that he bore 'some responsibility' for the scandal, Mr Jin yesterday said what Mr Li referred to was 'mainly leadership responsibility' rather than personal responsibility.