Chinese authorities have detained several employees of Evergrande’s wealth management division.
The move comes amidst the ongoing financial crisis plaguing the embattled property giant, China Evergrande Group.
Sources reveal that the police action was taken in response to mounting concerns over the company’s financial irregularities and its inability to meet its debt obligations. Evergrande has been grappling with a staggering debt load exceeding £200 billion, raising alarm bells not only within China but also globally.
The detained employees are suspected of being involved in fraudulent activities related to Evergrande’s wealth management products.
These products, which promised high returns to investors, have come under intense scrutiny as doubts about the company’s solvency grew. Investors have been flocking to withdraw their investments, fearing a complete collapse of Evergrande.
The Chinese government has been taking a more aggressive stance in addressing the Evergrande crisis, aiming to contain potential spillover effects on the broader economy. The detention of the wealth management staff marks a significant escalation in the government’s efforts to hold individuals accountable for the company’s financial mismanagement.
Analysts are closely monitoring the situation, and there are growing concerns about the potential fallout for the broader Chinese property market. Additionally, international investors are keeping a watchful eye on the crisis, given its potential to impact global financial markets.
