Regulators remove Anbang chairman Wu Xiaohui for ‘economic crimes’, take over conglomerate
Regulators take over firm for a year and will maintain it as a private company
China’s insurance regulator has taken over one of the country’s biggest insurers and initiated a criminal prosecution against its chairman, in the strongest action to eliminate financial risk and out-of-control fundraising.
Wu Xiaohui, the chairman of insurance and investment conglomerate Anbang Group, has been removed from his post, the China Insurance Regulatory Commission said on Friday.
Wu was placed under investigation in June last year. The commission, China’s insurance regulator, will take over the company along with the country’s central bank and regulators from the banking, securities and foreign exchange sectors, to maintain the “normal and stable operation” of the group, the regulator said.
“Wu is suspected of economic crimes … illegal operations at Anbang may have seriously endangered the company’s solvency abilities, prompting the government to take control of the insurer,” the commission said in a statement posted on its website on Friday morning.
The regulators will take over Anbang for a year and will “actively look for and introduce good quality social capital to restructure the firm”, while keeping Anbang “unchanged as a private company”, the commission said.
It said the takeover decision was made according to Article 144 of the Insurance Law, which states that the commission has the right to take over an insurance company when it faces severe insolvency problems, or damages public goods by breaking laws.
