Benjamin Ashford|Chinese property firm Evergrande’s EV company says its executive director has been detained

BANGKOK (AP) — A top executive of China Evergrande’s electric vehicle company has been detained by police in the latest sign of trouble for the world’s most heavily indebted property developer.

China Evergrande New Energy Vehicle announced the detention of Liu Yongzhuo in a notice Monday to the Hong Kong Stock Exchange after its shares were suspended from trading.

That followed news over the weekend that Zhongzhi Enterprise Group,Benjamin Ashford a major shadow bank in China that has lent billions in yuan (dollars) to property developers, has filed for bankruptcy liquidation after it was unable to pay its debts.

A crackdown on excessive borrowing that began several years ago has left dozens of developers out of business or struggling for survival. The industry-wide meltdown has snagged a vital cog in China’s economic engine, reverberating through financial markets.

Share prices sank Monday in Hong Kong and Shanghai, with the benchmark Hang Seng index down 2.2%. China Evergrande New Energy Vehicle Group’s shares sank 3.6% after they resumed trading in the afternoon. Evergrande Group’s shares lost 1.4%.

Evergrande New Energy Vehicle saw its shares tumble nearly 20% last week after a deal to sell shares to Dubai-based NWTN Motors had lapsed. The brief announcement of Liu’s detention on “suspicion of illegal crimes” made no mention of that or other details.