Police in a southern Chinese city have detained several staff members at China Evergrande Group’s wealth management unit, adding to the troubles of the heavily indebted developer.
According to a statement from Shenzhen police on Saturday, they have taken “criminal coercive measures” against suspects, including one named Du, who are associated with the financial wealth management company under Evergrande Group. The specific identity of Du remains unclear, and Evergrande has not yet provided any comments or clarification on the matter.
Earlier reports had mentioned a person named Du Liang as the head of Evergrande’s wealth management unit, revealing investor protests at the company’s headquarters in Shenzhen in 2021.
Evergrande, currently the world’s most heavily indebted real estate developer, is at the center of a property market crisis that is adversely impacting China’s economic growth. In an effort to avoid defaulting on its massive $340 billion debt, the group is undergoing a restructuring plan that involves selling off assets.
Recently, China’s national financial regulator approved the takeover of Evergrande’s life insurance arm by a new state-owned entity for further stabilization.
The series of debt defaults in China’s expansive property sector since 2021 has resulted in numerous unfinished apartment buildings and discontented homebuyers. There are growing concerns that this real estate crisis may further weaken the world’s second-largest economy and have global repercussions.