Ezubao was a Ponzi scheme, the Xinhua report said, and more than 95 percent of the projects on the online financing platform were fake.
Among those arrested were Ding Ning, the chairman of Yucheng Group, which launched Ezubao in July 2014.
It was not possible to reach Ezubao officials for comment and it was not clear if Ding had legal representation.
Ezubao’s website has been shut down and it appeared Yucheng Group’s Beijing office had been closed when Reuters reporters visited before Monday’s Xinhua report.
Chinese police said they had sealed, frozen and seized the assets of Ezubao and its linked companies as part of investigations into China’s largest P2P online platform by lending figures.
The Ezubao case has underscored the risks created by China’s fast-growing $2.6 trillion wealth management product industry. Many products are sold through loosely regulated channels, including online financial investment platforms and privately run exchanges.