China Investigates Troubled Shadow Banking Giant Zhongzhi

(Bloomberg) — Chinese authorities said they recently opened criminal investigations into the money management business of Zhongzhi Enterprise Group Co. Ltd., days after the embattled shadow banking giant revealed a shortfall of $36.4 billion in its balance sheet.

Police in Beijing said in a statement on WeChat that they took “criminal mandatory measures” against multiple suspects, identifying one by the last name Xie. They urged investors to report cases or provide leads to the authorities, including filing complaints online. Xie Zhikun, the group’s founder, died in 2021, but several of his relatives are currently executives at the company.