BEIJING/SHANGHAI: JD.com Inc's billionaire founder was arrested for alleged sexual misconduct during a US business trip, as local police begin an investigation into the chief executive officer of one of China's largest internet corporations.
Liu Qiangdong, who uses the English name Richard, was brought in at 11.32pm on Friday and released 4.05pm on Saturday, according to the Hennepin County Sheriff's arrest records.
Authorities decided not to hold Mr Liu in custody and haven't imposed any travel restrictions on the executive while conducting their investigation, Minneapolis Police Department spokesman John Elder said. But he declined to provide details about the reasons behind the arrest.
JD.com is the country's largest e-commerce company after Alibaba Group Holding Ltd, backed by investors from social media titan Tencent Holdings Ltd to American names Walmart Inc and Alphabet Inc's Google.
The company said on its official Weibo social media account that US police found no misconduct in their probe against Mr Liu. It didn't elaborate nor explain how that assertion squared with the police's own statement of an ongoing investigation. Representatives for JD weren't responding to requests for comment on Monday.
"We are very much in the infancy of this investigation," Mr Elder said. Authorities may decide not to charge Mr Liu at all, he added. "There are no travel restrictions on him at the moment and he's not charged with a crime at this time."
It's unclear how the incident will affect a $45-billion business that Mr Liu has led from its founding and controls through special voting rights. While JD has expressed ambitions to take its mainly Chinese-focused business to the US, the company has a minimal presence in America. Mr Liu does travel frequently to the US for speaking engagements and meetings with suppliers and partners. In its Weibo post, the company said he will continue his scheduled trip.
Earlier this year, a guest at a party he hosted in downtown Sydney was convicted of sexually assaulting a fellow guest after the event. There was no accusation of any misconduct by Mr Liu. The billionaire later lost a legal attempt to keep his name out of the records. Over the weekend, JD said it will take legal action against the publishing of untrue reports or rumours.
"Investors may treat the stock cautiously for the next short while as they wait to see how this issue is resolved," said Mark Natkin, managing director of Beijing-based Marbridge Consulting. "But I suspect it will likely not come to much and that it won't have any major long-term impact on the stock."
Mr Liu became one of China's best-known self-made billionaires by turning a chain of electronics goods stores into an online powerhouse selling everything from mobile gadgets to fresh seafood. It's Walmart's partner in the country and its largest shareholder is WeChat operator and games giant Tencent. The CEO has amassed a fortune of about $7.3 billion, according to the Bloomberg Billionaires' Index.
Mr Liu's JD has started pushing into physical stores and the billionaire speaks openly about his longer- term goal of expanding internationally, though its incursions overseas have so far mostly been limited to Thailand, Indonesia and Vietnam. Mr Liu has his eyes on the affluent consumers of Europe and the US as he makes substantial investments in the infrastructure needed to supply millions of customers around the world.
His high-spending strategy has drawn criticism from investors who would prefer it remain focused at home. JD's share price hit a record high in January only to tumble since then after failing to deliver the full-year profit many analysts had expected. In the June quarter alone, the company had a net loss of 2.2 billion yuan ($322 million).
"The arrest of JD.com's chairman and CEO in the US should not immediately impact the company's operations," Vey-sern Ling and Tiffany Tam, analysts for Bloomberg Intelligence, said in a report Monday.