The official crackdown on corruption that has caused such difficulties for Macau casino revenue is now targeting China’s lottery industry.
State-run news outlet China Daily reports that the National Audit Office has sent inspection teams to 18 of China’s provinces to determine exactly how the billions of dollars in lottery income is being allocated.
The audit has taken local authorities by surprise, according to reports, as it was not listed in the NAO’s annual work plan. Moreover, local auditors have been prohibited from participating in the lottery audit in what a source said was an attempt to “avoid a conflict of interest”.
The audit was reportedly sparked by mounting evidence of misallocation of lottery income. Sports Lottery funds are supposed to be reserved for public sports development, including the construction of sports facilities, but the lottery’s management authority in Shandong province reportedly spend RMB34 million (US$5.5 million) of lottery funds to upgrade government buildings and buy cars.
In total, 10 cities in Shandong reportedly failed to direct RMB214 million in lottery income to the proper accounts. Eight cities were found to have misused RMB102 million while another RMB34 million was said to have been outright embezzled.
Sales from country’s two official lotteries rose 20.3 percent in October to RMB32.7 billion (US$5.3 billion), pushing year-to-date sales 24 percent over 2013’s total to RMB312.1 billion.
