The reported disappearance of the financier, who has ties to Xi Jinping’s family, will ring alarm bells in the former British colony.

A billionaire with links to the family of Xi Jinping was reportedly taken from his apartment in the Four Seasons in Hong Kong by Chinese police and taken to the mainland.

Xiao Jianhua, one of China’s richest men, is currently in police custody on the mainland, the Financial Times and New York Times reported. He may be assisting with a graft investigation, part of the Chinese president’s sweeping campaign that critics say is more about consolidating power than tackling corruption.

If Chinese police were involved in Xiao’s abduction from Hong Kong, it would appear to violate the former British colony’s mini-constitution, which only permits the Hong Kong police to operate in the territory.

Xiao was born in China, is a Canadian citizen and holds a diplomatic passport from Antigua and Barbuda, reports said. He was living in a luxury apartment at the Four Seasons but a group of plain clothes Chinese security agents allegedly escorted him from the hotel across the border to the mainland, reports said. There was so sign of a struggle on CCTV footage taken at the hotel.

Xiao denied he had been abducted in two posts on his company’s social media account, but by Wednesday both had been deleted.

“Regarding the reports on me in recent days, I have to say that I, Xiao Jianhua, have been recovering from an illness outside the country,” he said in one of the posts. He said he had “not been abducted”, according to the statement that was quoted in Chinese state media.

But Hong Kong police said Xiao crossed into China through one of the city’s land border crossings on 27 January, contradicting Xiao’s claim he was receiving medical treatment “abroad”.

An unknown person took out a full-page advert on the front of a Hong Kong newspaper to reprint the now-deleted statements claiming to be from Xiao and “signed” by him.