The former chairman of Anbang Insurance Group, Wu Xiaohui, contested all charges against him in a high-profile trial that began in Shanghai yesterday, adding he was unaware whether his activities had violated the law.

The founder of the Chinese insurer that owns New York City’s Waldorf Hotel went on trial on charges he fraudulently raised US$10 billion (HK$78 billion) from investors and misused his position to enrich himself.

Wu was detained last year. Regulators took control of privately owned Anbang in February following a multibillion-dollar global buying spree that prompted questions about its financial stability.

The case added to an avalanche of scandals for Chinese insurers. The industry’s former chief regulator was charged in September with taking bribes. Executives of other insurers have been charged with corruption and mismanagement.

Beijing announced plans on March 13 to merge the Chinese banking and insurance regulators in a bid to step up scrutiny of those fast-evolving industries.

Wu is accused of fraudulently raising 65 billion yuan (HK$81.07 billion) and abusing his post to divert money for his own use, according to a report by prosecutors on the social media account of the Shanghai No 1 Intermediate People’s Court.

In court, Wu’s lawyer argued what he was accused of doing was a violation of regulations but not illegal, according to another post. A third post said Wu objected that he did not understand the law and did not know whether what he did was illegal.

Anbang said yesterday its business is stable it has “sufficient cash flow” to meet policy commitments.

Anbang discussed investing in a Manhattan skyscraper owned by the family of US President Donald Trump’s son-in-law and adviser, Jared Kushner. Those talks ended last year with no deal.

Regulators said they took control of Anbang on February 23 to protect its solvency and consumer rights.

Wu founded Anbang in 2004 and gained a reputation for aggressive expansion in a stodgy industry dominated by state-owned insurers.

The company grew to over 30,000 employees with 35 million clients. It diversified into life insurance, banking, asset management, leasing and brokerage services. Anbang’s buying spree stumbled after Beijing tightened investment controls in 2016.