A former central bank official is being probed for alleged legal violations in connection with his work, an announcement from a local inspection committee showed, in a case that one observer said could have big implications for China’s huge online payments industry.

Yang Biao, who once worked as a deputy director in the financial services department at the Shanghai head office of the People’s Bank of China, is being investigated for “serious violations of law” at work, a district inspection committee in Shanghai said last week in a post (link in Chinese) on its official WeChat account.

Yang worked for years at the central bank’s payment and settlement regulation department and was head of a payment unit in the financial services department starting in 2007. He left the central bank in 2014 and has worked in senior roles at payment companies since then.

The inspector did not disclose the specific case that led to the investigation. But multiple industry sources close to Yang told Caixin the investigation might be related to Yang’s time at the central bank.

The investigation has sent shockwaves through the sector, since the case being tackled may have happened over five years ago when China’s online payments industry was still in its formative stages. If the case is indeed related to licensing for third-party payments, then “the impact could be huge,” an industry source told Caixin.

Read the full story on Caixin Global later today.

Contact reporter Timmy Shen (hongmingshen@caixin.com, Twitter: @timmyhmshen)