Chinese authorities have sent investigators to the Shanghai headquarters of PDD Holdings Inc. (PDD) following a conflict between the company’s employees and regulators, Bloomberg reports.
The investigation covers alleged violations, including fraudulent deliveries and tax issues. The inspections involve the State Administration for Market Regulation and the State Tax Administration. Increased oversight has slowed the company’s marketing campaigns and ongoing projects, as employees prepare for audits and interviews.
PDD shares have fallen for the sixth consecutive day, losing over 12% since January 8. The investigation is raising concerns among investors, especially amid slower growth in the competitive Chinese market, where PDD competes with Alibaba Group (BABA) and JD.com (JD).