China’s sweeping anti-corruption campaign has claimed another target: the head of a powerful state lender.
Lai Xiaomin, a former Communist Party secretary and the former chairman of Huarong Asset Management, was kicked out of the party on Monday for “serious violations” of party law and regulations, including trading his power and influence for sex with several women, the government said.
Prosecutors could announce specific charges related to Mr. Lai’s case, the government said in an online statement.
His is the latest in a string of high-profile bribery cases involving officials and tycoons as Beijing reins in China’s financial sector and tamps down risky lending.
Huarong helped China’s biggest companies make big splashy acquisitions overseas. Several of its clients have come under scrutiny by officials for big deals, including the HNA Group and CEFC China Energy, the oil giant whose founder has been missing since February.
Mr. Lai was accused of violating political rules including “squandering waste of state property, illegally organizing public banquets” and accepting bribes, according to the Central Commission for Discipline Inspection, the party’s graft watchdog. He was required to hand over what the watchdog said was illegal income.
The announcement is part of a broader effort that has empowered Beijing to crack down on graft as President Xi Jinping consolidates his power and moves to impose strict discipline within the party. Mr. Lai was charged by the National Supervisory Commission, an anti-corruption body within the party’s graft watchdog, created in March with expansive powers to sidestep the courts and detain anyone on a government payroll for long periods of time without access to a lawyer.
The newly emboldened anti-corruption agency announced last week that the president of Interpol, the Chinese citizen Meng Hongwei, was under investigation for similar violations and had been detained. Soon after the announcement, Interpol said it received a resignation letter from Mr. Meng, putting an end to several days of mystery after Mr. Meng’s wife reported him missing.
Mr. Lai, 56, was arrested in April on allegations of violating the law. Several days later the company, which is publicly listed in Hong Kong, said he had resigned. On Monday the government elaborated, adding that Mr. Lai used his position and authority to amass money and “huge amounts of property.”
According to a report in Caixin, the well-respected business magazine, the police found nearly $40 million in cash that was collecting mold in properties that were tied to Mr. Lai. The report has since been taken off Caixin’s website.
Other executives tied to Huarong have also been arrested on allegations of accepting bribes. The government did not mention the other executives.
Huarong’s shares have lost more than 60 percent of their value since the beginning of the year. The company did not respond to a request for comment. Mr. Lai himself could not be reached for comment.
A longtime central bank official and onetime bank regulator, Mr. Lai took the helm at Huarong in 2012. He was also a representative at the 12th National People’s Congress.
Huarong was established in the late 1990s as one of China’s “bad banks” to serve as a repository for the nonperforming loans of state-owned companies that were preparing to list publicly. Huarong helped the Industrial and Commercial Bank of China to process its bad loans ahead of its initial public offering in 2006.
Since then Huarong has been involved in helping large Chinese companies deal with towering debt piles. In March it bought a 36 percent stake in a subsidiary of CEFC China Energy, which was in the process of acquiring a $9 billion stake in the Russian state oil giant Rosneft.
Huarong’s acquisition came a month after the disappearance of Ye Jianming, CEFC’s founder, who was detained by Chinese investigators and has not been seen in public since. CEFC is currently being slowly taken apart by the Chinese government while in the United States one of its top executives is facing allegations that he tried to bribe African officials in exchange for oil concessions.
Earlier this year another tycoon, Wu Xiaohui, was sentenced to 18 years in prison for defrauding investors after a bribery investigation. Mr. Wu rose to international fame when his company, Anbang Insurance, bought the Waldorf Astoria hotel in New York for nearly $2 billion.
Anbang was one of a handful Chinese companies that rocked markets from New York to London by paying large amounts of money for trophy assets.
The HNA Group, another conglomerate, had deals like the acquisition of Micro Ingram and Swissport, an airport cargo and ground services company, as well as large stakes in publicly listed companies like Hilton Hotels and Deutsche Bank. HNA is now winding down much of its international business.