The Red Cross Society of China has admitted renting its warehouse to a company to make money, Chutian Golden News reported.

Media reports claimed the charity earns 900,000 yuan ($146,560) a year by renting out its warehouse to an allegedly bogus company in the guise of a donation. The company makes millions by subleasing to logistics firms.

Zhao Baige, the society's executive vice-president, said the warehouse was rented when there were no goods and materials for use in disasters in preparation.

Government-allocated finance only covers two thirds of the organization's expenditure and it is not allowed to do business while it has so many employees to pay, which is why the Red Cross Society chose to rent its warehouse deceptively, Zhao said.

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