What's problematic is that the subsidy is a fix amount for certain kind of vehicle. And it turns out bus is more efficient in terms of subsidy/cost ratio. And since the subsidy is a fixed amount, bus maker can cut a lot of corners and make a bare minimum of a bus which may cost even less than the subsidy. Now they can dump these buses to a local government basically free and bribe the operators to drive the buses once a while to receive the subsidy[2].
I mean I'm all for green buses. But if electric buses out-sale electric cars a lot, you have to wonder why. And one obvious reason is buses are mostly bought in large quantities by entities not very concerned about cost/profitability, ie local governments. So it is much easier for bus related fraud than cars facing mostly individual consumers.
[1] https://www.wsj.com/articles/china-fines-five-auto-makers-fo... [2] http://www.sixthtone.com/news/1001382/company-accused-of-run...