(Bloomberg) -- Chinese authorities said they took “criminal mandatory measures” against some employees at the money management business of Zhongzhi Enterprise Group Co., weeks after a Beijing court accepted the shadow banking giant’s bankruptcy application.

Police in Beijing said the recovery of “stolen goods” is underway as it took action against suspects which included executives, according to a statement on WeChat on Saturday. They asked the company’s staff to actively cooperate with investigations and return all illegally-obtained gains to a designated account, as well as urged investors to report wrongdoing or provide leads.

Saturday’s police statement still didn’t elaborate on the crimes that may have been committed. Beijing police in November opened criminal investigations against Zhongzhi’s wealth units and took “criminal mandatory measures” against multiple suspects, identifying one by the last name Xie. Xie Zhikun, the group’s founder, died in 2021, but several of his relatives are currently executives at the company.

The mandatory, or coercive measures, can take several forms, including summons, release on bail and residential surveillance, detention and arrest, according to the Chinese procedure law. The measures can be enforced by the police, courts or prosecutors.

Zhongzhi filed for bankruptcy in January, cementing the rapid downfall of a firm that oversaw more than $140 billion at its peak before succumbing to the property crisis that has wreaked havoc on the Chinese economy. Later that month, Beijing Dacheng Law Offices was appointed as Zhongzhi’s administrator.

Chinese leaders have pushed for an unusually speedy resolution for Zhongzhi. Top officials concluded in October that bankruptcy would be the most effective approach in limiting the impact on financial markets, less than three months after Zhongzhi and its units defaulted on dozens of wealth products sold to the public, people familiar with the situation told Bloomberg then.

Zhongzhi first triggered concern in August 2023 after one of its trust-company affiliates failed to make payments to customers on high-yield investment products. The group’s financial difficulties add to President Xi Jinping’s challenges as officials grapple with a property crisis and a weak economy.

--With assistance from Amanda Wang.

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