The chairman of Apex Digital, a major US importer of TVs and DVD players, has been arrested in China.
The confirmation of David Ji's arrest came as Chinese media reports said he had been detained on fraud charges.
Meanwhile two Chinese firms say Apex, based in Ontario, California, owes them millions of dollars.
DVD player maker Genius says it is owed $4.3m (£2.2m), while TV maker Sichuan Changhong Electric insists the US firm owes it $467.5m.
The two firms said they would have to set aside provisions against the debts.
Sichuan Changhong Electric said it would leave it with a big loss for 2004, while Genius was unable to say if it would be able to make a profit or loss for the year.
Top seller
Apex, which employs 113 staff, distributes DVD players, televisions and other electronics to US stores such as Wal-Mart and Circuit City.
Among other products, it also provides digital cameras and home theatre systems, and is due to launch the Apextreme media and games console.
Earlier this week a spokesman for Apex - the top seller of DVD players in the US in 2003 - said it was struggling to meet home TV orders.
Police in Chengdu, in the southwestern province of Sichuan, have not revealed why Mr Ji, born in China, was arrested.
US consular officials and Apex have also not revealed the reason behind the arrest.
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