China's National Audit Office (CNAO) released information on corruption within one of China's biggest banks and a number of government bodies on Tuesday, alongside the results of an audit of the SARS prevention fund.
The Industrial and Commercial Bank of China (ICBC), the nation's biggest state-owned lender, punished 368 officials and employees and dismissed 42 others after a probe by China's top auditor revealed irregularities involving 6.9 billion yuan (US$833.7 million), the CNAO said.
The audit office found problems in its billing, consumer lending and loans to local governments and private companies after an eight-month inspection of 21 subsidiaries.
"Some branches only sought short-term interest at the cost of the bank's long-term development," the audit agency said. "Others ignored risk control while blindly expanding their business."
The CNAO said that in one case, 110 million yuan was illegally withdrawn from an ICBC branch. Elsewhere, 1 billion yuan in corporate loans ended up in individual saving accounts. It said a portion of that money was illegally transferred abroad.
China is stepping up monitoring of state-owned banks, part of a government effort to strengthen lenders ahead of greater competition with overseas rivals. ICBC has lagged behind the Bank of China and the China Construction Bank in shedding bad loans and reorganizing into companies eligible for listing.
The audit report adds to an avalanche of cases of embezzlement, fraudulent loans and other wrongdoing that have heavily cost state-owned banks.
The Ministry of Land and Resources and its subsidiaries were also found to have diverted 63.07 million yuan (US$7.6 million) for wages, bonuses and expenses between 2000 and 2003.
Meanwhile, 4.18 million yuan in fees charged by the State Bureau of Surveying and Mapping were not promptly turned over to the central government, according to an audit of its 2003 finances.
Between July and August of 2003, the CNAO launched a nationwide audit of SARS budgets and distribution of social donations.
Thanks to rigid supervision, the report said, the overall use and management of government money and social donations were good and there were no major cases of embezzlement discovered.
Nevertheless, some minor irregularities were found during the audit in connection to donations and distribution. Those irregularities were straightened out after audit, said the report.
The CNAO has instituted a mechanism for the periodic release of its auditing reports, which have drawn much attention from the public and media alike in China.
They recovered some 14.82 billion yuan (US$1.8 billion) last year after auditing more than 130,000 public units throughout the country.
(China Daily, Eastday.com November 3, 2004)