(Yicai) April 16 -- Two former fund managers of Lion Fund Management, a Chinese provider of investment management services, were taken to court for allegedly offering and taking bribes to and from non-state employees.

A case involving Cai Songsong and Qu Quanru, along with a third defendant, was heard by a court in Jinhua, China's southeastern Zhejiang province, on March 27. The case is pending a ruling, Yicai learned.

Shenzhen-based Lion Fund did not respond to Yicai regarding more information on the case, with details remaining unclear.

"The fact that the case's first instance was heard in an intermediate people's court tells us the situation may be severe and very complicated or quite influential," Chen Wei, a lawyer at Shanghai Digtech Law Firm Shenzhen, told Yicai. "It may involve a huge amount of money and many people, cause widespread harmful results, and result in long-term sentences, making it unsuitable for a grassroots people's court."

Cai joined Lion Fund in November 2017 and became a fund manager in February 2019 before resigning last September. He once triggered heated debates on Chinese social media after heavily investing in semiconductors and causing significant fluctuations in the net value of products he manages.

The annual percentage yield of products Cai managed reached as high as 95 percent because of his investment in semiconductors in 2019. The worth of assets under his management peaked at CNY41 billion (USD5.7 billion) at the end of 2020, accounting for 54 percent of non-monetary assets managed by Lion Fund.

However, impacted by changes in the domestic and overseas economic environment, the semiconductor sector cooled down and faced adjustments, with the worth of the assets gradually shrinking but remaining between CNY28 billion and CNY36 billion.

Qu joined Lion Fund as an investment manager in 2016 and took over six mutual fund products in 2019. The assets he managed were worth over CNY5.6 billion (USD773.9 million) in October 2022, the same month he quit the company.

Yicai found that Zou Xiang, another ex-fund manager of Lion Fund, faced criminal charges in September 2022. A Chongqing court ruled that Zou leaked information to his younger brother and then instigated him to make transactions via a securities account controlled by the pair, illegally gaining CNY23.6 million (USD3.3 million).

Zou tried to bribe those working at the public security bureau's economic crime investigations department with CNY4.3 million to assist during probes. He was sentenced to 11 years in prison and received a penalty of CNY14.5 million in the first instance on multiple charges.

Editor: Martin Kadiev