China arrests two foreign fraud investigators: diplomats

SHANGHAI - China has formally arrested a foreign husband-and-wife team of fraud investigators, diplomats said Thursday, whose firm did work for British pharmaceutical giant GlaxoSmithKline which is facing a bribery probe.

Police in China's commercial hub Shanghai had arrested Peter Humphrey, a British national, and Yu Yingzeng, a naturalised American citizen, diplomats from the two countries told AFP.

Humphrey is the founder of risk advisory firm ChinaWhys while Yu, a certified fraud examiner, served as general manager.

Diplomats declined to describe the charges.

China has detained four GlaxoSmithKline (GSK) executives for allegedly masterminding a scheme to funnel bribes to doctors in return for buying its products.

A statement by family members to The Wall Street Journal (WSJ) said the two were suspected of breaking Chinese laws related to purchasing personal information.

"We only know that Ying and Peter did investigative work on corruption within foreign companies," said the statement to the WSJ.

"As corruption is high on the schedule of China's government, the incarceration of Ying and Peter seems to be contradictory to China's policy in itself," it said.

Risk management industry officials said the two were detained around the same time in July.

The firm had done work for GSK, but the risk management and investigation sector itself has been under tighter Chinese government scrutiny for months, they added.

GSK has admitted some of its executives had violated Chinese law and pledged to cooperate with the investigation into it, which comes amid a broader government probe of foreign pharmaceutical firms operating in China.

A spokesman for the British consulate in Shanghai said Humphrey was arrested on Monday.

Humphrey, a former journalist for international news agency Reuters, worked for other risk advisory firms before setting up his own company in 2003.

A spokeswoman for the US consulate in Shanghai said consular officials visited Yu after her detention and were continuing to provide assistance.

Shanghai police did not immediately respond to request for comment.