Red Cross hit by another claim of funds misuse

PUBLISHED : Friday, 21 October, 2011, 12:00am
UPDATED : Friday, 21 October, 2011, 12:00am


The scandal-plagued Red Cross Society of China, the mainland's biggest charitable organisation, is embroiled in yet another controversy, accused of holding up the bulk of funds earmarked for Chinese forced to work in Japanese internment camps during the second world war.

In 2000, after a five-year battle, 11 of the forced labourers agreed to an out-of-court settlement with Kajima Construction in which the Japanese company used 500 million yen (HK$50.6 million) to set up the Hanaoka Peace and Friendship Fund, naming the RCSC as the trustee.

More than 40,000 Chinese were ferried to Japan to toil in internment camps during the war, and 986 of them were sent to the one belonging to Kajima.

Half of the fund, 250 million yen, was earmarked as 'aid money' for the 986 detainees, but the RCSC said in July it was able to track down just 520 of them, and according to Beijing-based Legal Weekly, the victims were each given between 16,000 yuan (HK$19,500) and 17,000 yuan.

The Red Cross has never revealed what it did with the rest of the money, set aside for the other 466 detainees and their families, according to Li Min, a mainland author specialising in Chinese labour during the second world war.

'No one knows where this money has gone and, frankly speaking, it could have been misused,' she said, adding that a lot of people were concerned about what the RCSC did with the rest of the money. They had unsuccessfully tried to convince the RCSC to disclose more details.

Several subsidiaries of the RCSC have been implicated in shady business deals and misuse of funds in the past several months. It followed a massive public campaign that began when Guo Meimei, a young singer and actress originally from Hunan province , showing off her wealth online, claimed to be the head of a non-existent business arm of the charitable organisation.

Yesterday, the RCSC denied any misuse of the fund for war labourers, saying the money had been used to aid victims and send their children to school, as well as to run awareness campaigns and exhibitions.

Fu Qiang, director of a legal aid group that supports Chinese labourers of the second world war, said that as the fund was in the Red Cross' care, the use of the remaining portion had to be limited to charitable projects under full public scrutiny, even though the other war detainees could not be contacted. 'The public has a good reason to be concerned if the fund is administered in such a shady way,' he said.

Fu said the case was not an isolated one in the distribution of funds for Chinese war victims by mainland charitable organisations.

The China Foundation for Human Rights Development was entrusted with a fund worth 128 million yen from Nishimatsu Construction in May last year for 183 Chinese war labourers, following an out-of-court settlement between the victims and the Japanese company a month earlier. But the foundation, a charitable organisation affiliated with the Information Office of the State Council, has allowed little public scrutiny of how the bulk of the fund has been distributed, if at all, according to a lawyer who declined to be named but who has been closely involved in lawsuits against Japanese companies and out-of-court settlements.