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August 24, 2009

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Party takes harder line on off-book infractions

CHINA'S top disciplinary watchdog yesterday released detailed penalties for officials who illegally hold so-called "small coffers" in its latest drive to fight corruption.

"Small coffers," an illegal practice regarded as a "cancer" by the Communist Party of China, refers to funds, securities and assets that should be but are not listed in the account books of the Party and government organizations in accordance with the law.

According to a circular issued by the Party's Central Commission for Discipline Inspection, officials would be punished in accordance with the Party's internal supervision regulations published in 2004.

Previously, the Party did not give a formal definition on "small coffers" and only gave directions on penalties.

Officials who illegally set up "small coffers," use the money to build or renovate office buildings, raise subsidy standards or deliver excessive bonuses for staff will receive penalties ranging from inner-Party warnings to being stripped of CPC membership, according to the circular.


Officials who use "small-coffer" funds on traveling, gala dinners and other recreational activities would be given similar penalties for splurging common property, it said.

The circular encouraged all people concerned to check the problem themselves.

Those who merely pretend to do so, or try to boycott the move or retaliate against whistle-blowers will be severely punished in accordance with the Party's internal-supervision regulations.

Those who set up "small coffers" after the CPC launched the campaign to crack down on the illegal practice early this year would be removed from their posts, the circular said.

For the rest of the year, the campaign will mainly target Party and government departments that completely rely on budgetary funds, according to the Party's disciplinary watchdog.

Income losses

It will later be extended to all social institutions, state-run companies and state-holding companies.

"Specifying punishment will help intensify the crackdown and make it more maneuverable," the circular said.

In some areas and departments, the practice of having "small coffers" has occurred frequently and at various levels of magnitude.

"The masses have responded strongly," the CCDI said.

The illegal practice had resulted in "inaccuracy in accounting, disturbance in market order, losses in state income and property and corruption," it said.

To guide the campaign, authorities have set up a special leading group with members from the CCDI, the Ministry of Supervision, the Ministry of Finance, and the State Auditing Administration.


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