Anbang's Wu Said Detained in Broad Probe Including M&A Funding

The life insurer appears to be facing a wide-ranging probe

(Photo: Thinkstock) (Photo: Thinkstock)

(Bloomberg) — Chinese investigators who detained Wu Xiaohui, chairman of Anbang Insurance Group, are carrying out a wide probe that includes looking into the sources of funding for the firm’s acquisitions overseas, possible market manipulation by insurers, and “economic crimes,” people familiar with the matter said.

(Related: FGL Falls After Anbang Withdraws N.Y. Request to Buy Life Insurer)

Wu is being questioned in a joint investigation including the police and a special unit of the Central Commission for Discipline Inspection, the people said, asking not to be identified because the probe is confidential. The scrutiny doesn’t mean Wu is accused of any crime or will face charges, they said.

The authorities are said to be examining Anbang transactions including acquisitions overseas and their funding. The probe also fits into a broader investigation of possible market manipulation by insurers, the people familiar said. They didn’t specifically define the term “economic crimes.”

Shooting to fame with its purchase of the Waldorf Astoria hotel in New York in 2014, Anbang went on a $13.4 billion global acquisition spree that came to a virtual halt at the end of 2016.

The firm has faced increased scrutiny: China’s central bank was said to look into suspected breaches of anti-money laundering rules at the insurer late last year, while authorities temporarily banned Anbang’s life insurance unit from selling new products in May.

The Wall Street Journal reported earlier that investigators were checking whether Wu was involved in bribery and other economic crimes at Anbang. He can’t be contacted for comment. On Wednesday, Anbang said Wu couldn’t perform his duties for personal reasons, and a company spokesman in Beijing said Thursday the firm has no further comment.

--- Read An Absent Chairman Is the Least of Anbang's Problems on ThinkAdvisor.

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