China's Embattled Property Developer Evergrande Falls In Deeper Pit: Police Detains Wealth Management Staff

Following China Evergrande Group's EGRNF inability to repay investors, Chinese authorities have taken certain employees from the company's wealth management division into custody. 

This marks the initiation of the first criminal investigation against the beleaguered property developer since a colossal debt crisis struck it in late 2021.

The detentions of its official indicate a potential new investigation that could further compound the company's existing problems.

During protests by disgruntled investors at Evergrande's Shenzhen headquarters in 2021, Reuters noted, Du Liang was identified by staff as the general manager and legal representative of Evergrande's wealth management division.

In a statement on social media on Saturday night, the police in Shenzhen disclosed that they had taken "criminal compulsory measures" against Du and other suspected individuals associated with Evergrande Financial Wealth Management Co. 

However, it remains unconfirmed whether Du was among those detained, as the police statement did not specify the number of people arrested, the nature of the charges filed against them, or the date of their detention.

The southern metropolis of Shenzhen's local police disclosed that they had recently apprehended several employees from Evergrande Wealth, a division established in 2015 to raise funds for its parent company from individual and corporate investors. 

This operation falls under China's "shadow banking" sector, which operates outside the conventional banking system and is subject to relatively light regulation. 

It plays a significant role in China's financial sector by channeling funds into high-yield investments.

Evergrande's current valuation stands at approximately HK$ 8.2 billion, representing a dramatic decline from its peak in 2017 when the company was valued at nearly HK$ 420 billion.