Tencent Executive Arrested by China’s Government Over Alleged Corruption

Tencent Holdings Ltd. said one of its executives, Zhang Feng is being probed over an alleged corruption case in his personal dealings, not involving the company as a whole.

The tech giant said the investigation does not involve Tencent’s messaging service, WeChat, a spokesperson said. It was earlier reported by The Wall Street Journal that the executive had been arrested for allegedly collecting personal WeChat data and sharing it with former vice public security minister, Sun Lijun, who is currently being investigated by Beijing.

Zhang has been under probe by China’s anti-graft inspector for nearly a year. While Lijun is being investigated by Beijing for unspecified violations of Communist Party rules, a report carried.

The Tencent spokesperson said investigators are investigating what kind of data Zhang may have shared with Lijun and the implications. The spokesperson made it clear that Tencent’s chairman and co-founder Pony Ma isn’t under probe.

The Chinese tech firm said earlier this month it fired more than 100 employees over alleged fraud probes in the past year. It has also reported more than 40 workers to the police.

China closely following up on its most powerful tech firms including Tencent and Alibaba Group Holding Ltd., as it works on tightening scrutiny on them. The Chinese government seeks to rein their growing power and influence across the finance and e-commerce sectors.

Tencent shares fell as much as 1.4% in early trade in Hong Kong on Thursday.

“It definitely will trigger some profit taking for the stock given it has surged significantly this year,” Daniel So, a strategist at CMB International Securities Ltd. “Although the case involves corruption which is a sensitive topic, it seems that the impact will not be as deep as Alibaba at this moment as it is linked to an individual rather than the internet business. Investors will still embrace the stock.”