China has banned Anbang Insurance from issuing new products for the next three months.
The penalty was issued after regulators said a current Anbang product, the Longevity Happiness #5 Annuity Insurance, "evades existing agency regulations [and] disturbs market order."
"Anbang should place great importance to the issues of product development and management, strictly follow regulatory policy and requirements, and work quickly to reform," the China Insurance Regulatory Commission said in a statement.
Beijing has engaged in broader scrutiny of the financial sector in efforts to clean up markets. And while a three-month ban may not seem a hefty penalty, this is adding to the long list of woes for Anbang, a giant Chinese firm that once made headlines for its global success and ambitions.
But lately, the company has found itself under a more negative spotlight – perhaps a sign that the tide is turning.
Last week, a report by a respected Chinese publication accused the company of a serious lack of transparency, alleging financial mis-dealings that allowed the firm to grow its assets to $275 billion. Anbang pushed back, saying its moves were by the book, and that it would sue the magazine, Caixin, and its top editor.
Even before that, Anbang was fending off rumors circulated online that the company was under government investigation and that its chairman, Wu Xiaohui, had been detained. Wu later gave an interview to a Beijing newspaper to dispel those rumors. CNBC confirmed with the company then that the interview had occurred.
The Beijing-based firm was once on a massive shopping spree, blazing a trail of acquisitions around the globe in its aim to become one of the world's largest financial groups. Anbang's Wu even said he wanted the company to have a presence on every continent over the next decade in a 2015 speech at Harvard University.
Anbang made a splash in 2014 with its $2 billion purchase of New York's iconic Waldorf Astoria hotel as it sought to branch out from its core financial business. But its global expansion hit a snag as recent deals have tanked — last year, the company lost its bid for Starwood Hotels to Marriott International, and this year, it failed to acquire Fidelity & Guaranty Life.
Wu is married to the granddaughter of Deng Xiaoping, the Chinese patriarch who championed opening up China, helping the country become the world's second-largest economy.
Anbang didn't immediately respond to a request for comment regarding the regulatory ban on Monday.
--With reporting by Barry Huang