The authorities in China have raided the Beijing office of the Mintz Group, an American corporate investigations firm, and detained all five of its Chinese employees, the company said on Friday.
Mintz Group said in a statement that the authorities closed its operations in Beijing. The company has not been able to contact the employees since they were taken away.
It was unclear what the authorities’ objectives were in investigating the company, and the government did not respond to a request for comment. But the move highlighted the potential risks that firms involved in due diligence face in China as Xi Jinping, the country’s top leader, has repeatedly called for a greater emphasis on security and has tightened the ruling Communist Party’s grip on information.
“We can confirm that Chinese authorities have detained the five staff in Mintz Group’s Beijing office, all of them Chinese nationals, and have closed our operations there,” Mintz said in a statement. The Chinese nationals were detained on Monday, said two people familiar with the investigation who spoke on condition of anonymity because of legal sensitivities.
The Mintz Group, which is based in New York, does due diligence work — background checks, asset tracing, and fraud and corruption investigations — for companies before they make acquisitions or other large investments. The company says that it has over 450 investigators in 18 offices around the world.
Such work has been the target of the Chinese authorities in the past. In 2013, the Shanghai authorities arrested a British investigator, Peter Humphrey, and his wife and business partner, Yu Yingzeng, an American. They had operated a corporate investigations firm, ChinaWhys, that also did due diligence for multinationals.
Both were charged with violating the rights of private citizens by obtaining private information about them. Each spent two years in prison before being released and allowed to leave China.
Even as China tightens security policies, Beijing officials have also been trying to persuade foreign companies to resume investing. China almost completely closed its borders for nearly three years during the pandemic but lifted its “zero Covid” policies in early December and began reopening its borders in early January.
The raid comes as an annual gathering of multinational chief executives and senior Chinese government officials known as the China Development Forum was set to open on Saturday. Chinese economic policymakers have been hoping that the gathering would be a chance to re-establish international investment confidence in China.
Tim Cook, the chief executive of Apple, and Ray Dalio, who founded the world’s biggest hedge fund, Bridgewater Associates and retired late last year, are scheduled to attend the forum. But few other prominent American executives are scheduled to attend or speak at the forum this year. Many American companies have become worried about getting caught between pressure from the Chinese government to express support, and pressure from Congress to show that they are standing up to Beijing on issues like human rights, and have gone silent.
