A Xinhua News Agency reporter has revealed another alleged illegal operation of a State-owned lottery enterprise.

The whistle-blower, Wang Wenzhi, a reporter from the Economic Information Daily newspaper under Xinhua, told the Global Times Sunday that he has informed the Ministry of Finance about the illegal operations of the China Lottery Online Co Ltd.

The company's general manager He Wen "controls the system, sales data and funds of the lottery, which severely violates regulations," Wang wrote in the letter, which was made public on Sunday.

Funds from the company have been secretly transferred to He, "who has amassed 2 billion yuan ($322 million) by abusing his authority," the letter added.

"Lottery data and technical skills should be separately managed to prevent fraud, but He's company played both roles for 12 years," the letter said, referring to the company as a "freak" in the industry, which is a bad case of lottery management.

Wang said that he first published the story in May on He's alleged shady deal, but has not openly published the latest information for fear of reprisals.

Wang said He has sued him for defamation. Wang is demanding 5 million yuan in compensation and a public apology for seven consecutive days. The case was heard by a local court in Haidian district, Beijing. A decision has yet to be made.

The company could not be reached as of press time, but has previously denied Wang's May report, news website chinanews.com said.

Wang gained fame for a post he made on his Weibo against Song Lin, former president of China Resources (Holdings) Co Ltd, a State-owned enterprise, in July 2013, accusing Song of massive corruption.

He then accused Song of serious dereliction of duty on Weibo in April 2014.

Song was placed under investigation in April 2014 and was expelled from Chinese People's Political Consultative Conference (CPPCC) National Committee in June 2014.