CEO of Chinese online game streaming firm arrested
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CEO of Chinese online game streaming firm arrested amid executive crackdown company said it had only been informed of the arrest.

DouYu becoming the latest business leader to run afoul of authorities in the world’s second largest economy.

In addition, it warned that Mr. Chen’s “ongoing detention, as well as any subsequent legal proceedings and enforcement actions,” could have a material impact on its business. It did not receive any official notice of the investigation or reason for Mr. Chen’s apparent arrest.

In a statement posted on Chinese social media on Wednesday, Chengdu police said a 39-year-old man was arrested on suspicion of opening a casino. The statement was cited by Xinhua as confirmation that the DouYu executive had been arrested.

State-owned media outlet Cover News reported two weeks ago that Chen had become unreachable. Chen, who has been missing for nearly three weeks, was being investigated, according to unconfirmed reports.

In May, the internet watchdog said Chen disappeared about five months after the Cyberspace Administration of China conducted an onsite inspection of DouYu to investigate what it called “serious” problems related to the platform, including alleged pornography and “vulgar” content.

Three people running popular accounts on the platform were sentenced to up to six years in prison for “opening casinos” by the Intermediate People’s Court in Chengdu last December.

An online lottery they ran attracted about 4.4 million users, and almost 120 million yuan ($16.9 million) was collected, the court said.

According to the court, it was the first gambling case involving a live-streaming platform handled by the police under direct orders from the Ministry of Public Security, making it of national significance.

DouYu’s shares closed nearly 6% in New York on Tuesday following news of the arrest.