Tencent Holdings extended losses to close more than 10% lower after the Wall Street Journal reported it faced a record fine for violating Chinese anti-money laundering regulations.
The People’s Bank of China found Tencent’s WeChat Pay had allowed the transfer of funds for illicit purposes such as gambling, the newspaper reported, citing unidentified people familiar with the matter. WeChat Pay was also judged non-compliant with other rules that required Tencent to identify users and merchants transacting on the platform, the Journal said.
A probe into potential money-laundering would open a new front in Beijing’s sweeping crackdown on the internet industry, an effort that’s already wiped out hundreds of billions of dollars in arenas from ride-hailing and e-commerce to online education. Tencent itself has thus far mostly escaped formal regulatory action. Unlike rivals Alibaba Group Holding and Meituan, the WeChat operator hasn’t yet been the direct target of any government probe.
