ExplainerHere are 3 anti-corruption tools in China’s arsenal that may be underutilised

Owning ill-gotten homes and hoarding stockpiles of cash is getting harder in China as privacy wanes and transparency reigns

China’s graft-busters are putting corrupt officials on notice with eye-opening checks and balances

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China’s digital yuan, the e-CNY, is highly traceable. And some civil servants will be paid in it. Photo: Shutterstock

Published: 7:00am, 21 May 2023

China’s anti-corruption storm is raging on, with dozens of state bank executives and financial cadres investigated so far this year, while government officials and managers of state-owned enterprises have come under greater scrutiny in terms of their family assets and business conduct.

In addition to an annual asset-declaration mechanism, here are some unconventional tools that China’s discipline inspectors and prosecutors could wield in their graft-busting gambit.

1. Digital yuan

China is the world’s front-runner in piloting a central bank digital currency, and its e-yuan, also known as the e-CNY, has already been used in more than 26 pilot cities, with more than 100 billion yuan (US$14.3 billion) worth of transactions reported so far.

Although it is mainly designated for small retail payments such as paying utilities or ordering a cup of coffee, it can actually be used in other scenarios such as cross-border trade, corporate spending, payrolls and bank loans.

“The traceability of the digital currency can be used to effectively deter and combat payment deductions and corruption,” Hong Yong, a fellow with the Ministry of Commerce’s research institute, said last year.

Speculation about using it for anti-corruption purposes increased as Changshu, a city of 1.5 million people in east China’s Jiangsu province, announced in April that civil servants and other state sector employees will be receiving their salaries in the e-yuan starting in May.

The announcement immediately raised privacy concerns among local officials, particularly about where and how much they spend every day, and it could shed light on purchases of luxury items or elaborate banquets.

China executed Lai Xiaomin, former chairman of China Huarong Asset Management, in 2021 after millions of yuan were found in his home (pictured). Photo: Xinhua

Previously disclosed corruption cases often saw lots of cash or gold ingots stored in safes. For instance, a deputy department head with China’s top economic planner, Wei Pengyuan, was found keeping 200 million yuan worth of cash at home in 2014.