A CEO went missing. Then his bank got a mysterious bill for $11 million

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A Chinese investment bank known for making some of the biggest deals in the country’s tech sector during its heyday has revealed it received a massive bill for 78 million yuan ($11 million) related to the disappearance of its star banker, Bao Fan.

The request for payment from unspecified Chinese authorities only deepens the mystery surrounding the whereabouts of Bao, who founded boutique investment bank China Renaissance in Beijing in 2005 and made it one of the top dealmakers for Chinese tech firms.

He helped broker the 2015 merger between two of the country’s leading food delivery services, Meituan and Dianping. Today, the combined company’s “super app” platform is ubiquitous in China.

The opaque nature of Bao’s disappearance has sent shockwaves through the Chinese financial services and tech sectors, further denting business confidence during a marked economic slowdown.

The case followed those of other high-profile business leaders in China, where it is not uncommon for executives to suddenly drop off the radar with little explanation.

In February 2023, China Renaissance reported him missing amid a wider anti-corruption crackdown. A year-and-a-half later, no official charges or allegations have been made against Bao.

Last summer, the Economic Observer, a state-run financial publication, reported that Bao had been in the custody of the country’s top anti-graft watchdog, the Central Commission for Discipline Inspection, since his disappearance. He was said to be involved in an investigation into suspected corporate bribery.

CNN has not been able to reach Bao since his disappearance.

In February, Bao officially stepped down as its chairman and CEO of the investment bank for “health reasons and to spend more time on his family affairs,” it said in a filing to the Hong Kong stock exchange.

China Renaissance, which revealed the existence of the $11 million bill last week in a separate, delayed stock filing, said: “The group is not privy to and has no reliable information on the status of any investigation with which Mr Bao is in co-operation.”

In fact, it has such scant information about the case and the related payment demand, which was received in the last three months of 2023 and subsequently paid, that its auditors struggled to figure out how to account for it on the books, the Financial Times reported on Wednesday, citing unnamed sources. CNN has reached out to the investment bank for additional information.

In the end, China Renaissance filed the item under “other receivables,” according to the stock filing, which generally refers to any outstanding money a company is owed after delivering goods or services to customers.

It said while the payment may be considered by Chinese authorities to constitute “property associated with a case under investigation,” it doesn’t imply a legal judgement or a fine. The bank’s lawyers have advised that the amount could be “refunded or confiscated.” It may also be required to pay more.

Because of the mystery payment, the bank’s Chinese auditor, Zhonghui Anda CPA, had to issue a “qualified opinion” on its 2023 annual results, indicating it may contain omissions or possible misstatements.

Its previous auditor, Deloitte Touche Tohmatsu, one of the so-called Big Four global accounting firms, resigned in December because it was unable to reach Bao.