Key Takeaways
- Staff of NetEase Games have been reportedly arrested on suspicion of laundering money.
- The estimated amount of laundered money is reportedly between $111-$140 million.
- The stock price of NetEase Games has dropped over 5% as a result of the scandal.
A report from the Chinese website Leifeng (nice spot, Vice) suggests that several employees at NetEase Games have been arrested under suspicion of money laundering. NetEase Games is a substantial Chinese conglomerate known previously for operating Chinese versions of Blizzard games and now as the developers of Marvel Rivals.
The report suggests the arrests were a result of an internal ‘sting operation’ by NetEase. The location of the weekly marketing meeting, normally held in Guangzhou, was changed to Hangzhou in advance. When general manager Xiang Liang and others suspected of corruption arrived in Hangzhou, they were detained and investigated.
The amount of money allegedly laundered is estimated to be between 800 million and 1 billion yuan ($111 million to $140 million). Additionally, members of Xiang Liang’s team were suspected by NetEase to be purchasing traffic for the studio’s games. This could have been to skew performance metrics, but that’s only conjecture. According to Leifeng, several employees have already been released, but Xiang Liang has not responded to requests for comment.
This scandal has already resulted in a corresponding 5% drop in the price of NetEase’s stock (NTES) since trading opened today.
NetEase’s Expansion Hasn’t Been Painless
NetEase has been making a push into international markets in recent years through acquisitions and partnerships. NetEase acquired Suda51’s Grasshopper Manufacture in 2021, Quantic Dream in 2022 and, as mentioned previously, is a long-time partner of Blizzard Entertainment, having launched Diablo Immortal in collaboration with the studio in 2022.
In 2022, Valorant developer Riot Games and parent company Tencent successfully sued NetEase for copyright infringement. According to Riot, NetEase’s hero shooter HyperFront was too similar to Valorant. HyperFront was shut down following the lawsuit.
NetEase’s most anticipated title, the 6v6 hero shooter Marvel Rivals, is currently set to release on December 6 after several betas and playtests. The game will have 26 characters at launch, including Psylocke, who recently had some of her gameplay leaked online.
Marvel Rivals is a 6v6 third-person shooter with teams comprised of comic book heroes and villains. It features a range of destructible maps from across the Marvel universe, with new content added periodically.