July 2, 2015 / 8:56 AM / 4 years ago

China military spending probe finds 'long-standing abuses'

BEIJING (Reuters) - A probe into military spending over the past 18 months has found “long-standing abuses”, including illegally held bank accounts, embezzlement, tax fraud and padded expenses, state media said on Thursday, in an ongoing campaign against corruption.

China’s armed forces, the world’s largest, have become a focus of President Xi Jinping’s battle to root out deeply ingrained graft including bribery, which often takes the form of lavish gifts to officials or extravagant spending of government funds.

The investigation into spending “earnestly exposed the contradictions and long-standing abuses which existed”, the official Xinhua news agency said, in a story also carried on the Defence Ministry’s website.

It found that some units spent money on projects which had not been budgeted for, failed to pay expenses, spent too much on entertainment, siphoned off funds for personal use and other problems, Xinhua said, without providing a figure.

Money which has been misappropriated or misspent would have to be paid back, and those suspected of more serious offences would be prosecuted, it added.

In a separate statement, the ministry said it had issued rules covering the award of contracts to build military projects, saying the process must be simpler, more transparent and corruption-free.

Proper competition for contracts must be enforced that “ensures the best win and the worst are discarded”, the statement said.

The anti-graft drive in the military comes as Xi steps up efforts to modernise forces that are projecting power across the disputed waters of the East and South China Seas, though China has not fought a war in decades.

China intensified its crackdown on corruption in the military in the late 1990s, banning the People’s Liberation Army from engaging in business. But the military has been involved in commercial dealings in recent years due to a lack of checks and balances, military analysts have said.

Reporting by Ben Blanchard; Editing by Nick Macfie

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