• May 23, 2024

China Probes Huabao Founder

 China Probes Huabao Founder
Photo: Andrey Popov

Chinese regulators have announced an investigation into Chu Lam You, the majority shareholder in Huabao International Holdings, China’s largest e-liquid, tobacco flavoring and fragrance company.

One of China’s richest self-made women, Chu is being investigated for unspecified “suspected disciplinary violations,” according to a Hong Kong stock exchange filing. The company said in a statement that it was informed of the investigation by its subsidiary Huabao Flavours and Fragrances. “Up to the date of this announcement, the company has not been provided with any details of the nature of the suspected violations of Ms. Chu that [are] currently being investigated. The business operation of the group remains normal,” the company stated.

Huabao added that the subsidiary received a case filing notice from the Leiyang City Supervisory Committee indicating that the probe was being carried out by the Chinese Communist Party and the local government, according to the Financial Times.

Launched in 1996, Huabao produces flavors and fragrances used by tobacco manufacturers, including for the e-cigarette or vaping market, as well as food companies.

Like many high-profile Chinese businesspeople, Chu has also served on various industry and government advisory committees. The probe into Chu comes as China’s long-running anti-corruption campaign gathers momentum as Xi seeks to secure a historic third term.