Scandal hits 2008 Beijing Olympics

Officials diverted funds meant to build facilities

updated 7:30 p.m. ET June 24, 2004

BEIJING - Chinese sports officials misused more than $13 million meant for the 2008 Beijing Olympics to build apartments for their staff, state media said Thursday.

The disclosure was an embarrassment for officials who have pledged to keep the Summer Games free of the corruption and abuses that plague China’s government.

The money diverted to apartment construction was among $15.9 million in misused Olympic funds found by an audit of the Beijing sports bureau, the Xinhua News Agency said.

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Some $13.2 million was spent on apartments, with the rest invested illegally in companies, Xinhua said, citing a report to parliament by China’s auditor-general, Li Jinhua.

Such misconduct is routine in China, where thousands of officials are punished every year for extortion, embezzlement and abuse of power.

But Beijing Olympic organizers took the unusual step of setting up an independent audit department in an attempt to assure China’s public that its money was well-spent.

The misconduct wasn’t found by Olympic auditors, because their powers don’t extend to the city sports bureau, said a spokesman for the Olympic organizing committee. He refused to give his name.

No officials have been punished, said the spokesman.

The committee issued a written statement Thursday noting that the case didn’t involve its own use of public funds.

“The Beijing Organizing Committee for the games ... uses its funds in strict accordance with the regulations and rules set by the International Olympic Committee,” said Zhang Haifeng, the committee’s spokesman.