OMG, the scale of these disappearances is absolutely staggering.
The sinister disappearance of China’s bosses
Detentions, public shaming and suicides intensify the country’s corporate gloom
Illustration: Simon Prades
Oct 8th 2025|Shanghai |6 min read
Until recently Yu Faxin was best known as a leading scientist and entrepreneur, specialising in advanced semiconductors for military applications. But on September 22nd he made headlines for another reason. His company, Shanghai-listed Great Microwave Technology, disclosed that Mr Yu had been taken away by China’s anti-corruption agency. Mr Yu is in liuzhi, an extra-judicial form of detention in which increasing numbers of Chinese businessmen are being snared.
The country’s entrepreneurs must contend with a lengthening list of worries. Foremost is the economy, which has never fully recovered from the pandemic. Consumer sentiment is tepid at best; overproduction and ruthless competition are rife. Retail sales have shrivelled. The number of lossmaking industrial firms has been hovering at a record high.
But a further set of concerns is growing in prominence. As the economic outlook darkens, China’s institutional shortcomings are making the business elite even more miserable. Official investigations into company leaders are on the rise. So are court rulings that limit their freedom to travel around the country. A spate of suicides among bosses this year is widely seen as evidence of intensifying pressure.
Liuzhi detentions are perhaps the clearest source of unease. When the system was created in 2018 it was aimed mainly at Communist Party members and government officials, part of the anti-corruption crackdown begun by Xi Jinping, China’s supreme leader, five years earlier. It is now frequently directed at businesspeople too.
The system runs parallel to normal policing. Detentions do not require court approval. Detainees are denied the standard services of lawyers. Changes to regulations in June allow agents to hold people for up to eight months, to reset the clock if a new crime is suspected and to interrogate prisoners endlessly. Cells typically have no windows, lights are always on and detainees are often supervised 24 hours a day, even when using the toilet.
This year bosses at listed companies have been vanishing into this grim system at a staggering rate: The Economist counted 39 such cases by the end of September, or about one a week, in stock-exchange filings. That already exceeds last year’s record tally. But it is just a fraction of the broader picture. Most corporate liuzhi targets work for unlisted companies, which are not obliged to explain to investors why their chief executives have disappeared.
Chart: The Economist
Total detentions, including those of both officials and businesspeople, soared by nearly 50% in 2024, to around 38,000, according to statements by the Central Commission for Discipline Inspection (CCDI), the party body authorised to carry them out (see chart 1). The corporate side of the crackdown appears to be extensive. The CCDI has said it took some form of disciplinary action (including liuzhi) against more than 60,000 people in the pharmaceutical sector and 17,000 in finance last year.
One explanation of why so many bosses have been detained is the rapid expansion of Mr Xi’s corruption crackdown. The number of cases filed is on track to hit a record 1m this year, reckons Gavekal Dragonomics, a consultancy. When an official is investigated, their entire business network can come under scrutiny, leading to a ballooning in corporate cases. Some of the industries facing deepening anti-corruption probes, such as computing hardware and green technology, are tightly connected to local governments through procurement and contracting, notes Zhu Jiangnan of the University of Hong Kong. This puts executives in these fields at greater risk.
Flagging economic growth may also help to account for the rise in detentions. Local governments are short on cash; many have enormous debts. Some CCDI investigations have been characterised as “deep-sea fishing” expeditions, in which an executive is held on flimsy grounds in the hope that the harsh conditions of liuzhi will yield a confession of wrongdoing or the accusation of another wealthy person. The investigators can then seize that person’s (and their company’s) assets.
Of the 39 executives of listed firms lifted this year, more than half were detained by CCDI departments far from their companies’ headquarters. A Chinese lawyer specialising in such cases says this is a sign that one local government is fishing in another’s jurisdiction in search of funds. (The lawyer has asked to remain anonymous.)
Another cause of bosses’ distress is a notorious credit blacklist, to which the names of some of the country’s richest tycoons have recently been added. China’s bankruptcy laws are not fully developed and courts often reach for quick fixes to put pressure on debtors to pay up. One method is to publicly add their names to the list, which bans them from “high consumption”. Those on it may no longer fly, ride on high-speed trains or stay in fancy hotels, among other things.
Chart: The Economist
This credit list may originally have been intended to force people to repay small debts, but entrepreneurs have been herded onto it in recent years as their ventures struggle. A court database shows that by the end of September some 200,000 people had been added this year, up from around 17,400 in the whole of 2019, before the economic rupture of the pandemic (see chart 2). About 46% of this year’s blacklistings were owing to contractual disputes, indicating that business-related activities led to the court rulings.
The fear of falling onto the list is real and may lead companies to take fewer risks. It is thus another “dangerous drag on business sentiment”, says Lizzi Lee of the Asia Society Policy Institute’s Centre for China Analysis, a think-tank. At a time when the economy is badly short of dynamism, “the signal from the current system is that if you fail, you don’t just lose your business; you may lose your basic ability to function,” she says.
The central government has tried to improve conditions for entrepreneurs. In February Mr Xi met a handful of China’s top company bosses in the hope of signalling a reset. A new “private-sector promotion” law was put in place to help spur growth.
But the dominant mood among entrepreneurs has instead stayed gloomy. On September 28th it was revealed that ■■■■ Jianlin, a property tycoon who was once China’s richest man, had been added to the debtors’ blacklist because of a contractual dispute. This ban was lifted a day later but not without igniting a discussion on the dire situation facing some leading business figures. Mr Yu’s detention has had a similar effect. If senior military scientists can be swept into liuzhi, no one is out of the corruption agency’s reach.
The suicides have made matters darker still. Between April and July at least five prominent bosses leapt to their deaths from high buildings, leading to anguished public discussion about the burden on entrepreneurs. The suicide of ■■■■ Linpeng caused particular shock. The founder of a successful department-store chain, ■■■■ was once the richest man in Hubei, his home province. In April he was put into liuzhi. He was freed in late July, but kept on a watch list. His suicide, days after his release, is just one of the few “that float to the surface”, says the lawyer. “There are many more that no one knows about.” ■