A total of 41.11 million yuan (US$4.95 million) allocated in southwest China's Yunnan Province for earthquake relief projects has been embezzled or misused by local officials, according to a report released in Beijing recently.

The National Audit Office (NAO) assessment said a total of 366.62 million yuan (US$44.2 million) had been collected for Dayao County, after it was hit by two quakes measuring 6.1 and 6.2 on the Richter scale in 2003.

The scandal was revealed after checks on the fund's accounts in 2004 found that 12 local authorities at different levels and hundreds of officials may have been involved in the scandal.

Financial, civil affairs, construction, education and health departments from provincial to township level all took part, according to the NAO report, which said that:

The state-owned Caohai Farm in Yaoan County misappropriated 17.48 million yuan (US$2.11 million) to pay compensation for land requisitions;

Binchuan County's civil affairs bureau took 1.5 million yuan (US$181,600) to erect a government building;

Two local hospitals misused 250,000 yuan (US$30,200) of relief funds to build dorms; and

Two financial bureaus in Mouding and Yaoan counties embezzled 5.65 and 3.5 million yuan (US$684,000 and 423,000) to balance their budgets in 2003.

Auditors also found that 51.74 million yuan (US$6.26 million) of funds were not distributed to locals in time and that 8.68 million yuan (US$1.05 million) was given on a false basis.

To date, local governments have been investigating the scandals and 48 officials from Chuxiong Prefecture have been given administrative penalties, said the report. 

(Xinhua News Agency May 10, 2005)