Accounts of the founder of the Chinese LeEco arrested on a court decision for non-payment of interest on loans. The loans themselves were spent on the development of smartphone business. Because of the rapid expansion in all directions at the same time, LeEco is struggling with huge debts, and such huge investments do not help.

Arrested accounts of Jia Yuethin.

Accounts of Chinese billionaire Jia Yueting (Jia Yueting), the founder of the technology company LeEco, were arrested by decision of the Shanghai Supreme People's Court, reports BBC. The lock affected not only the accounts of Jia himself, but his wife, as well as three enterprises associated with LeEco. In total, the frozen accounts are 1.24 billion yuan (about $ 183 million).

The reason for the arrest was the non-payment of interest on loans, which Jia took to develop the smartphone business LeEco. The suit in this regard was filed by the Shanghai branch of China Merchants Bank. The decision of the court must enter into force immediately. LeEco has the opportunity to appeal within five days from the receipt of the warrant. According to Chinese media reports, Jia allegedly resigned as LeEco's authorized representative, transferring his responsibilities to top manager Wu Meng,.

In addition to Jia's accounts, the court for three years froze his share in the share capital of LeEco and bonuses coming from the joint venture for the sale of Dasheng Technology cars. Jia's fortune is now estimated at $ 3.6 billion. In 2015, the. The entrepreneur laid 85% of his stake in LeEco to provide personal loans. Loans were spent on business development, primarily smartphone.

Problems with LeEco.

On financial problems LeEco Jia Yuehin said in November 2016. In an open letter to the company's employees. As a reason, he pointed out an excessively rapid growth in all directions at once - in simple terms, the acquisition by Leshi, known as "Chinese Netflix", of the automotive and smartphone business at the same time. Jia, who ambitions on the smartphone market provided the nickname of "Chinese Steve Jobs," pledged to cut his own income to 1 yuan (about $ 0.15) and promised to slow the pace of development.

A few days later it became known that LeEco stopped the construction of a plant for the production of electric vehicles in Nevada, because it owed the contractor $ 21 million in September. The project of the plant is Faraday Future, based in California, USA. LeEco plans to invest in the plant about $ 1 billion over 10 years. Jia repeatedly stated that the company will be equipped with the latest technology and become the main competitor of the manufacturer of electric vehicles Tesla Motors. For these statements, the businessman received in the Western media the nickname "Chinese Ilona Mask".

Attempts to escape.

In January 2017. LeEco said that the financial difficulties are over. Vendor managed to attract about $ 2.18 billion investment from Chinese developer Sunac China and $ 260.93 million from other investors. For the funds received, LeEco paid the shares, it was the largest sale of securities in the company's history. Jia said that the money will be spent on competition with Internet companies Baidu, Alibaba and Tencent.

At the end of June 2017. It became known that the received investments could not save LeEco. This was reported by Jia himself at the annual meeting of shareholders. According to him, the units of the holding, whose securities are not traded on the exchange, suffer most of all, although investments in them amounted to $ 1.3 billion. According to the results of the first quarter. 2017 g. The receivables of LeEco were about $ 1.4 billion.