China has arrested Zhang Jin, the owner of a Fortune 500 company, according to a report in South China Morning Post (SCMP). Mr Zhang has been arrested for illegal fundraising estimated at about $2.9 billion, the outlet further said. Chinese media outlet Caixin Global reported that Mr Zhang, founder and chairman of Cedar Holdings, had been under pressure to repay the amount due to investors in wealth management products backed by the company. The company’s sales managers from across China had gathered at the company headquarters demanding that Mr Zhang take personal responsibility for overdue payments.
SCMP said that Cedar Development, the clothes manufacturing unit of the group, said in an exchange filing on Tuesday that it could not reach Zhang Jin, who owns 70 per cent through indirect holdings.
His arrest is the latest since Beijing has ramped up crackdown on financial crimes to maintain “social stability”. It is also one of the most high-profile investigation and arrest of a tycoon since China relaxed its Covid-19 restrictions in November last year.
The police have collected have collected relevant information and tasked other agencies to carry out assessments and audits, the SCMP report said. They have also sealed assets of Cedar.
Fifty-two-year-old Zhang Jin founded Cedar in Guangzhou in 1997 after a successful run at the stock market, according to Forbes. He has a bachelor’s degree in economics from Shenzhen University and a master’s degree in management from Hong Kong Polytechnic University.
Before Mr Zhang, another Chinese tycoon, who was close to former US President Donald Trump’s former political advisor Steve Bannon, was arrested in March and charged with bilking $1 billion from supporters of his anti-Beijing activities.