A fraud investigation into the founder of Camsing Global, a private Chinese entertainment conglomerate, has sparked quarrels between financial institutions and e-commerce giants JD.com and Suning.com over their roles in a fundraising scandal, reported Caixin.
Leading Chinese wealth manager Noah Holdings Ltd. said RMB 3.4 billion ($490 million) of asset management products backed by Camsing Global’s accounts receivables from JD.com were in danger of default. JD.com said it is “unaware” of the matter. Similar debates arose between Yunnan International Trust Co. and Suning involving products that raised more than RMB 1 billion for Camsing Global backed by pending payments from Suning.
The disagreements between the companies started last week when Camsing Global’s Shanghai-listed arm Boxin Smartcom (Suzhou) Sci&Tech Co. Ltd. said in a statement that its chairwoman and controlling shareholder Lo Ching had been detained by Shanghai police. Chief Financial Officer Jiang Shaoyang was also detained, Boxin said without elaboration.
A Caixin source told Noah that the company detected risks from products linked to Camsing Global in May after the company made suspicious account changes and requested an increase in a fundraising amount. After an internal inspection and meetings with Lo that failed to resolve Noah’s questions, Noah decided to report the allegations to police.