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An Internal Report of the Central Government

An Internal Report of the Central Government.

About the Current Situation of Widespread Corruption in China And Strategies to Combat It

Over 600 Billion Yuan (US$72.5 billion) Lost in Gambling Annually

On February 19, 2005, CCTV’s evening program "Half an Hour on Economy" featured the rampant gambling activities by Chinese officials in China and overseas. According to an eyewitness, some people carried over US$10 million to overseas casinos to gamble. The former vice-mayor of Shenyang City (capital city of Liaoning Province) lost 30 million yuan (US$3.8 million) in three days of gambling. The former vice-mayor of Xiamen City, Lan Fu, lost 3.5 million yuan (US$0.42 million) on one occasion. According to statistics, China’s annual currency outflow to overseas casinos amounts to 600 billion yuan (US$72.5 billion). A huge amount of national property is wasted due to these corrupt practices.

Fake Job Positions Found in Provincial & Municipal Governments

A recent investigation discovered that 8.5% to 10.4% of government payroll positions were faked in the governments of Shanxi Province, Taiyuan City, Henan Province and Zhengzhou City. This practice has been going on for five to seven years already. About 182 to 212 million yuan (US$22 to 26 million) were internally pocketed each year from these fake payrolls.

Money from Land Sale Is Unaccounted For

A recent investigation in Xiamen City by the National Land Property Department confirmed that all state-owned land in Xiamen City had been sold out, making Xiamen the first city with a population of over one million in China to have sold all available land. Furthermore, the whereabouts of over 70 billion yuan (US$8.4 billion) from the land sale could not be identified.

300 Billion Yuan (US$50.6 billion) Missing from the Shanghai Land Development Fund

In mid-July 2004, after investigation of Zhou Zhengyi’s case, it was found that out of a total of 420 billion yuan (US$50.6 billion) of the Shanghai land development fund, 300 billion yuan (US$36.1 billion) could not be found. The situation was so serious that the central government issued an order: "Shanghai city-level officials must get permission from the Central Politburo before they can travel abroad."
Senior Government Officials Captured While Fleeing

On July 16, 2004, six senior officials at the bureau level from Hubei Province were arrested in Guangzhou’s Baiyun Airport VIP Lounge. These officials were senior leaders in key government departments such as Finance, National Land Administration and Taxation. They were waiting to board a plane to escape to Australia via Thailand. Collectively, they were carrying foreign currencies of over 4.3 million U.S. and Australian dollars.

Early in the morning of May 11, 2004, near Zhuhai City, a speedboat heading to international waters got into a gunfight with a military boat. The exchange left the speedboat destroyed, five people dead, and three wounded. The military personnel found over US$10 million cash and 20 kg (44 pounds). gold bars on the seized boat. Several senior Communist officials from Yunnan Province were among the dead.

On August 3, 2004, the CCP’s Central Disciplinary Inspection Committee, Ministry of Supervision, and Ministry of Public Security issued a joint internal report. Up to June 30, 2003, statistics of Communist officials missing, escaped, and committed suicide, based on reports from provincial and municipal-level disciplinary committees and police departments, are compiled in table 1. (The data only include communist officials working at Party and administrative agencies and state-owned companies and departments.) From June 30, 2003 until now, how many more officials have escaped with foreign currency remains a question.

This report was posted on the website of Beijing Dajun Economic Monitor and Research Center at