The Government needs to tighten laws and give the central bank greater power to fight money laundering by corrupt cadres, according to scholars interviewed by the People's Daily.
Huang Weiding, an economist and expert in money laundering, was quoted as saying cadres had many ways to launder their 'hidden wealth'.
Some cadres collected as many bribes as possible while in power and then tried to claim their wealth was legitimate income earned from companies they set up after retirement.
Others laundered their bribes through family members and relatives.
Some set up companies while in office and used the firms' bank accounts to hide their wealth. Another effective way was to hide the bribes overseas, Mr Huang said. In many cases, they even arranged for their families to move abroad.
The article warned: 'The adverse effect of foreign capital flight cannot be overlooked. It results in losses of tax revenues and may affect our foreign exchange reserves. Some are worried this will endanger China's financial stability, even leading to a financial crisis.'
