Another scandal hit quake reconstruction efforts in Sichuan this week, with 90 million yuan (HK$108 million) found to have been misused by a county government in Mianyang , one of the regions worst affected when the quake struck three years ago.
Mainland media reported that the state assets department in Santai county gave permission in December 2009 for the 90 million yuan from its reconstruction funds to be allocated to Hongda Company, a capital-raising platform owned by the county government. The company needed the money to show accountants that it met registered capital requirements.
A subsidiary, Hongda Land and Property Development Company, is involved in 158 reconstruction projects in Santai worth 209 million yuan, with three-quarters of the funding coming from the central government.
The misuse was first exposed by an investigative news programme on China Central Television last Saturday. An unnamed National Audit Office official said on Thursday that the 90 million yuan sat in Hongda Company's account for about 10 days, before being given to Hongda Land and Property for legal reconstruction projects.
Nevertheless, laws were broken, and four officials has been removed from their positions - Hongda's former chairman, the head of Santai's state assets bureau and two water bureau officials.
The audit official said further investigations were being carried out at the county and city level, suggesting that more officials might be implicated.
It is the county's latest scandal related to quake relief. Three officials from Santai's Jinya village were jailed for seven years in 2009 for extorting quake victims by telling them they needed to pay them in order to secure central government subsidies.