Fosun chairman latest to disappear amid anti-graft probe

Mr Guo's Fosun Group owns the Club Med chain of resorts and has a stake in the Canadian entertainment company Cirque du Soleil.
Mr Guo's Fosun Group owns the Club Med chain of resorts and has a stake in the Canadian entertainment company Cirque du Soleil.PHOTO: REUTERS

Billionaire may have been arrested as China cracks down on the financial industry

HONG KONG • As the Chinese authorities intensify their scrutiny of the financial industry, the billionaire chairman of one of the country's biggest private conglomerates is missing, a local financial news magazine reported on Thursday.

Mr Guo Guangchang, 48, described by local media as "China's Warren Buffett", may have been arrested by the police or taken in for questioning, the news magazine Caixin reported, citing people familiar with the matter.

He is chairman of the Fosun Group, which owns the Club Med chain of resorts and has a stake in the Canadian entertainment company Cirque du Soleil, with interests spanning insurance companies and property holdings.

Mr Guo's disappearance is the latest in a series of mysterious circumstances surrounding an anti-corruption investigation into the financial industry. Since August, many executives have been arrested or detained by the police, while others have disappeared.

The investigation follows the sharp decline in the Chinese stock market this summer, with stocks in Shanghai plunging more than 40 per cent. Instead of letting markets take their course, the central government in Beijing undertook a major effort to bolster prices.

Last month, Mr Yim Fung, chairman of Guotai Junan International, the Hong Kong unit of one of China's biggest brokerage firms, disappeared. He has not been reachable since Nov 18, the company said in a statement to the stock exchange.

On Sunday, Citic Securities, the country's biggest brokerage firm which is often likened to Goldman Sachs, said it was "not able to get in touch" with two top executives - Mr Chen Jun and Mr Yan Jianlin - overseeing investment banking. In its statement, the company cited news media reports saying the two "were suspected of being requested to assist in an investigation".

Several top executives at Citic Securities have been detained since August. The Chinese authorities are investigating company officers, including its president, Mr Cheng Boming, for an insider trading case.

"Investors are advised to exercise caution in their investments and be aware of the risks," Citic Securities said in the announcement about Mr Chen and Mr Yan's disappearance, after reports about their situation appeared in the Chinese news media last Friday.

In the case of Mr Guo, the company's listed arm, Fosun International - whose shares trade in Hong Kong - has not made any announcement about its missing chairman. Calls to the company's offices in Hong Kong and Shanghai were not answered. Mr Liang Xinjun, the company's vice-chairman, told Bloomberg News that the company was "handling" the situation.

Yesterday, trading in Fosun International shares in Hong Kong was halted, with no further expla-nation made by the company.

In some cases, executives are released after working with investigators, as was the situation with Ms Li Yifei, who is China head for the Man Group, one of the world's biggest hedge funds.

Others are arrested and detained. Mr Xu Xiang, a hedge fund manager, was apprehended by the police after a car chase. The government said he was suspected of insider trading.

Last Friday in Wuhan, a Chinese billionaire detained over a political corruption scandal, Mr Xu Ming, 44, was found dead in his prison cell. Chinese news media reported that he died of a heart attack. His body was cremated the next day. It is not known whether an autopsy was performed.

NEW YORK TIMES

A version of this article appeared in the print edition of The Straits Times on December 12, 2015, with the headline 'Fosun chairman latest to disappear amid anti-graft probe'. Print Edition | Subscribe