Monday , March 31 2025

China frees staff of US due diligence firm after two years

27-03-2025

BEIJING: China has released five staff of the due diligence firm Mintz Group after nearly two years in detention, the United States-based company has said.

Chinese authorities detained the five local staff in March 2023, marking the start of a series of raids on foreign consultancy and due diligence firms, including Bain & Company and Capvision Partners.

China’s National Bureau of Statistics announced later that year that Mintz Group, which has its headquarters in New York, had been fined $1.5m for undertaking “foreign-related statistical investigations” without the necessary approval.

“We understand that the Mintz Group Beijing employees who were detained, all Chinese nationals, have now all been released,” a Mintz Group spokesperson said in a statement provided to multiple media outlets on Tuesday.

“We are grateful to the Chinese authorities that our former colleagues can now be home with their families.”

The release of the employees follows the conclusion of the China Development Forum, which has long served as a platform for Beijing to promote the country to foreign investors.

This year’s edition of the forum, which wrapped up on Monday, was attended by dozens of top business leaders, including Apple’s Tim Cook, Pfizer’s Albert Bourla and Saudi Aramco’s Amin Nasser.

Speaking at the two-day gathering on Sunday, Chinese Premier Li Qiang pledged to expand market access for foreign investors and urged firms to resist the rising tide of protectionism.

“In today’s increasingly fragmented world with rising instability and uncertainty, it is more necessary for countries to open up their markets and enterprises… to resist risks and challenges,” Li said.

Mintz Group, which specializes in background checks and investigations into fraud and workplace misconduct, employs more than 280 investigators at 12 offices in 11 countries, according to its website.

In August, 2023, China has fined US firm Mintz Group about $1.5m for doing “unapproved statistical work” after a raid of its Beijing office sparked worries about China’s openness to foreign investment.

The Beijing’s Bureau of Statistics said in a ruling dated July 5, first reported by The Wall Street Journal, that the firm had carried out “foreign-related statistical investigations” without seeking and obtaining approvals.

In a further notice on its website dated July 14, the bureau said Mintz conducted 37 such investigations from March 2019 to July 2022.

As punishment, the bureau confiscated 5.34 million yuan of the firm’s “illegal proceeds” and imposed an administrative penalty of an equivalent amount, resulting in a total fine of about $1.5m.

Mintz has 60 days to file an appeal and six months to file an administrative suit. It did not respond to a request for comment by the Reuters news agency.

The firm has previously said it is licensed to conduct legitimate business in China and that it has always operated lawfully.

As per Mintz’s website, its services include background checks on potential business partners and new hires, fact-gathering for lawsuits and internal investigations.

Chinese authorities raided Mintz’s Beijing office in March and detained all five local staff in what turned out to be the beginning of a sweeping crackdown on consultancy and due diligence firms, including Bain & Company’s office in Shanghai and Capvision Partners. (Int’l Monitoring Desk)

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