The mainland's top audit chief has accused two state-owned banks of involvement in fraudulent loans worth billions of yuan. The National Audit Office said the Industrial and Commercial Bank of China (ICBC) and Bank of Communications permitted widespread fraud by accepting false documents and receiving bribes from lenders in the property, vehicle and consumer sectors, according to a report by auditor Li Jinhua presented to the National People's Congress Standing Committee. In one case, borrowers produced fake documents as credentials to receive 6.9 billion yuan to buy flats, cars and consumer goods. The ICBC loans included 71.41 million yuan issued by the bank's Shanghai branch to an individual, Yao Kangta, to speculate in property, buying 128 flats. Examining a Beijing branch's 791 million yuan worth of vehicle loans to dealers, the audit office found 12 per cent, worth 96.5 million yuan, were made by four dealers using fake documents. In other cases involving ICBC, borrowers presented false contracts and tax receipts to receive improper loans worth 10.1 billion yuan. One company cited in the report, Luoyang Fenlai Trade, accepted 492 million yuan in improper loans and slipped bank employees 2.16 million yuan in kickbacks. Luoyang Fenlai was acting as a middleman between the bank and Dalian Shi De Packing. Thirteen companies in Foshan, Guangdong, issued false documents to obtain 7.42 billion yuan in loans from ICBC's Nanhai branch. Just 1.9 billion yuan remained in the accounts, the rest was in the hands of the Foshan companies, the report said. Apart from the ICBC, the Jinzhou branch of the Bank of Communications conspiring with local courts was fabricating documents to write off 221 million yuan in corporate non-performing loans made to 175 entities. China Life Insurance, in its pre-listing form, was also snared in the audit office's web, accused of stealing nearly 2.37 billion yuan by inflating its premiums and ending contracts before they were due. The insurer was also found to have illegally issued 2.48 billion yuan for loans, investments and building office blocks. The auditor said seven individuals were being investigated and one had been arrested in the Bank of Communications case. Mr Li said new risks had emerged in the consumer loan area for ICBC, with property developers and vehicle dealers improperly receiving bank funds. The auditor said the irregularities at China Life were being addressed by the company.