Shanghai Makes Formal Arrests in Child Molestation Case

(Bloomberg) -- Shanghai authorities said Wednesday that they’ve formally arrested two individuals for suspected molestation of a minor. The city’s investigation of the allegations has captured national attention in China.

In a statement posted on its Weibo social-media account, the prosecutor for Shanghai’s Putuo District identified one of those arrested by the surname Wang, and the other by the surname Zhou. It gave no additional details.

The arrests come after Shanghai police on July 3 said they were holding two individuals for suspected molestation of a minor, identifying one suspects as a 57-year-old with the surname Wang and the other as surnamed Zhou. Shortly after the police announcement, Future Land Development Holdings Ltd. said its 57-year-old founder and controlling shareholder Wang Zhenhua was being held in criminal custody for “personal reasons.”

Seazen Holdings, Future Land’s Shanghai-listed unit, said on Wednesday that Wang was formally arrested today, without naming the charges. Operations remain normal, Seazen said in the statement to the Shanghai Stock Exchange.

Wang’s detention has triggered an investor exodus from Future Land and other real estate companies linked to him. Not only has that wiped out billions of dollars of market value, it’s also raised questions about the companies’ access to financing and fueled speculation that rival developers might try to take over all or part of Wang’s empire.

--With assistance from Jing Jin.

To contact Bloomberg News staff for this story: Emma Dong in Shanghai at edong10@bloomberg.net

To contact the editors responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net, Charlie Zhu, Allen Wan

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With assistance from Bloomberg