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China's state broadcaster implicates Jack Ma's Ant Group in corruption scandal

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New Delhi | Saturday, 2022 1:45:08 AM IST
Chinas state broadcaster has implicated Jack Ma's Ant Group in a corruption scandal, ratcheting up pressure on the billionaire following a crackdown that has wiped billions of dollars from his internet empire, the Financial Times reported.

A documentary on state-run China Central Television alleged that private companies made "unreasonably high payments" to the brother of the former Chinese Communist Party head of Hangzhou, an eastern city that is home to Ant Group's headquarters, in return for government policy incentives and support with buying real estate, the report said.

According to public records and two sources close to the deals, a unit of Ant Group bought two plots of land at a discount in Hangzhou in 2019 after taking stakes in two mobile payment businesses owned by the party secretary's younger brother that were named in the documentary.

While the documentary did not name Jack Ma's company, the Ant unit was the only external corporate investor in one of these businesses, according to public records, and was among three corporate investors in the second.

"The nature of such a transfer of interests is an exchange of power and capital," said the documentary, produced by the Communist Party's Central Commission for Discipline Inspection. Material aired by China's state broadcaster represents the official party line, FT reported.

The programme has intensified pressure on Ant, as the fintech group with more than 1 billion users struggles to overhaul its business to comply with the authorities' demands.

Chinese regulators pulled the plug on a $37 billion initial public offer planned by the company in 2020 and forced it to restructure. Last week, Ant suffered a setback to its government-led reform efforts after a state-owned asset manager pulled out of a deal to invest in the fintech's lending arm without explanation, FT reported.

The documentary alleged that Zhou Jiangyong, the former Hangzhou party secretary who was arrested in August for corruption, helped unidentified companies acquire cheap land and enjoy preferential policies after they bought shares in firms controlled by the senior official's younger brother, Zhou Jianyong.

Public records show Shanghai Yunxin Venture Capital Management Co, a subsidiary of Ant, paid $268,000 for a 14.3 per cent stake and a board seat in Youcheng United (Ningbo) in March 2019, the report said.

--IANS san/arm

( 394 Words)

2022-01-21-19:38:02 (IANS)

 
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