China’s financial giants hammered in discipline review

China’s top policy financial institutions, which are expected to shoulder an even more prominent role in Beijing’s economic diplomacy, received harsh criticism from top anti-graft agency inspectors after a two-month disciplinary review.

Analysts said that while the public reports might only reveal part of the corruption besetting the institutions, Beijing appeared determined to introduce anti-graft reforms in the sector as it expanded its footprint in global finance.

Among the 21 financial regulators and institutions that came under review, China Development Bank, the country’s biggest policy bank, and China Investment Corporation, the mainland’s sovereign wealth fund, are among the major fund contributors to the Silk Road Fund – a main vehicle for China to promote its “One Belt, One Road” strategy.

“There were graft risks and moral hazards in credit, procurement and project construction,” the Communist Party’s Central Commission for Discipline Inspection said about the CDB.

“The problem of extravagance is prominent. Office space surpassed the standards excessively and it built luxurious hotels in multiple places with many remaining idle.”

In the reports, the CIC was criticised for playing golf with public money while overseas travel using the taxpayers’ dime continued “despite repeated prohibition”.

“There were wrongdoings in policymaking and severe problems in the tunnelling of interests,” the agency said, adding that CIC’s marketing fees “went out of control” and problems of discipline “occurred frequently”.