This post was originally published on this site
HONG KONG (Reuters) -CICC Capital, a unit of Chinese investment bank CICC, has decided to stop using consultancy Capvision Partners’ services, three sources said, as some financial firms review their ties with China’s largest “expert network” group.
Capvision is the latest consultancy and due diligence firm to get caught in Beijing’s sweeping crackdown on what state media describes as “intensifying” law enforcement aimed at protecting national security.
In an internal memo issued on Tuesday, which was confirmed by sources with direct knowledge, CICC Capital’s research division said it would ban all its teams from using Capvision for due diligence-related expert calls and inquires.
The ban will come into immediate effect, the memo said, adding that research teams should also review previous dealings with Capvision.
CICC, which handles media queries for the alternate investment arm, declined to comment. Capvision did not immediately respond to Reuters request for comment.
CICC Capital’s investment teams have also been barred from using Capvision for such experts calls or inquiries, said the sources who declined to be identified as they were not authorised to speak to the media.
CICC Capital manages yuan and U.S. dollar-denominated private equity funds and fund of funds and had 360 billion yuan ($52 billion) of assets under management as of the end-2022.
Chinese police raided Capvision offices over what state media this week reported were national security issues.
Capvision, which runs China’s largest expert network group and has offices in eight cities around the world, was singled out in a series of news reports including a 15 minute segment by state broadcaster CCTV on Monday.
The CCTV report said Capvision had accepted projects from overseas companies to source information, including “state secrets and intelligence” on sensitive sectors including defence and advanced technology.
