Airline investigation broadens its scope

Two more executives at China Southern Airlines have been caught up in a corruption scandal, bringing to six the number of senior executives placed under investigation by the top anti-graft watchdog.

Lu Hongye, general manager of the corporation's financial department, and Hu Zhiqun, general manager of its construction development branch, have been held for investigation on charges of corruption, an insider of the corporation revealed to Chinese media.

Lu is alleged to have misused his power to promote Tao Lifang, a female employee in his department who was also reported to be his mistress.

A whistle blower posted a notice on a website giving records of 410 days that they stayed in luxury hotels in Guangzhou from January 2009 to June 2011, with total room charges of 360,000 yuan ($60,000).

Tao was removed from her post and is facing an investigation, according to the insider.

Hu was in charge of land development and assistance for airline transportation, which is a hugely profitable business.

On Monday, the board of China Southern Airlines approved the removal of Chief Financial Officer Xu Jiebo and Executive Vice-President Zhou Yuehai. The week before that, ChenGang, executive vice-president, and Tian Xiaodong, COO of flight operations, were removed from their jobs under suspicion of corruption.

An audit in early December revealed irregularities at China Southern and the anti-graft authority was said to have extended its inspection after it found rampant corruption at the airline.

The investigation of China Southern Airlines, Asia's largest carrier by passenger numbers, is part of a third wave of investigations into State-owned enterprises by the Central Commission for Discipline Inspection, which started at the end of last year.

Other companies being investigated as part of the third wave include China Unicom and Shenhua Group.