Fri, November 28, 2008
China > Mainland > Police investigating China's richest man

China's home appliance giant says second boss under police probe

2008-11-28 04:00:47 GMT2008-11-28 12:00:47 (Beijing Time)

BEIJING, November 28, 2008 - China's largest home appliance chain said Friday that a second senior executive was under police investigation in a case in which the firm's billionaire owner is suspected of "ecomomic crimes".

Beijing police are investigating Zhou Yafei, chief financial officer of the Hong Kong-listed Gome Electrical Appliances, the company said in a statement filed to the city's stock exchange.

It also acknowledged that police were investigating Huang Guangyu, the 39-year-old founder and chairman of the company, over a "certain suspected economic crime", it said, after police issued a similar statement on Thursday.

But the statement said the investigations were not related to the company and insisted that the assets and funds of Gome Group were not misused.

"The Company has conducted preliminary internal checks on the assets of the Group and the results of these checks have not revealed any misappropriation of the assets and funds of the Group," the statement said.

A Chinese financial magazine on Sunday said Huang was taken in last week for questioning over wild fluctuations in the price of a company controlled by his brother.

But China's securities watchdog has said the reason for the probe into Huang is "complicated" and involves more than just stock price manipulation, according to Chinese state media.

Gome's shares in Hong Kong were suspended on Monday after the news broke of the investigation into Huang.

Huang was ranked as number two on a list of China's richest people issued by US magazine Forbes in October with assets of 18.4 billion yuan (2.7 billion dollars).

Forbes listed him as China's richest man in 2006.


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