The contract that brought down China's rail minister Liu Zhijun
The downfall of rail chief Liu Zhijun began with an inkling of a fishy deal, report says
It was one of tens of thousands of contracts for the 200 billion yuan (HK$253 billion) Beijing-Shanghai high-speed rail project but it ignited auditors' suspicions and eventually brought down then-railways minister Liu Zhijun, China Youth Daily reported on Monday.
The equipment deal was for 50 million yuan - not a lot in the scheme of things - but staff from the National Audit Office's branch in Jinan, Shandong province, noticed during an initial assessment in 2009 that the bid had been "won" by a company with no expertise in rail construction, the report said.
The money was then transferred to a company called Dongrun, which did not issue an invoice for the purchase of the equipment.
Its licence to buy equipment had also been revoked.
Dongrun was controlled by businesswoman Ding Shumiao, who also headed up two other firms that were the eventual recipients of the money, the report said.
When auditors visited Dongrun to see the equipment, an executive said it had been sent to Madagascar, but there was no declaration record of the shipment with customs, the report said.
The auditors suspected the 50 million yuan contract was the tip of an iceberg of huge economic crimes.