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Executives Arrested as Hong Kong Intensifies 'Enigma Network' Probe

  • ICAC and SFC searched eight locations in a joint operation
  • Crash in June saw some stocks plunge by as much as 90%
The logo of the Hong Kong Independent Commission Against Corruption (ICAC) is displayed outside the the commission's headquarters in Hong Kong, China, on Tuesday, April 10, 2012. The Independent Commission Against Corruption on March 29 detained and later released Thomas and Raymond Kwok, co-chairmen of Sun Hung Kai Properties Ltd., on suspected bribery charges.

Photographer: Jerome Favre/Bloomberg

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Five months after one of the most dramatic stock crashes in Hong Kong history, the city’s authorities are stepping up their investigation into a group of companies that one prominent investor has dubbed the “Enigma Network.”

Hong Kong’s anti-corruption and securities regulators searched eight locations and arrested three senior company executives on Thursday, the Independent Commission Against Corruption said in a statement. The actions were related to the Enigma Network, a group of 50 listed businesses highlighted by activist investor David Webb for their complex web of cross-shareholdings, according to a person with knowledge of the matter.