SHANGHAI -- The chairman of a property group is under investigation in connection with Shanghai's biggest corruption scandal in decades, a report said Tuesday.

Wang Zheng, former chairman of Shanghai New Huangpu Real Estate Co, was detained on Thursday in connection with the scandal over alleged misuse of billions of dollars in city pension funds, the financial magazine Caijing said in a report on its Web site.

Shanghai New Huangpu Real Estate announced Tuesday that Wang had resigned as chairman. Its announcement, posted on the Web site of the Shanghai Stock Exchange, gave no explanation for his resignation.

Wang's company is a unit of the Shanghai New Huangpu Group, which has signed a deal with Japan's Rockefeller Group to direct the development of a massive property project near the city's famous Bund waterfront.

The New Huangpu Group is one of several big state companies embroiled in allegations of misuse of more than 3 billion yuan (US$380 million; euro300 million) in city pension funds.

Dozens of officials and businessmen reportedly have been questioned in connection with the scandal, which toppled the city's top leader, Communist Party secretary Chen Liangyu -- the highest ranking Chinese official to lose his job on corruption charges in more than a decade.

The affair has highlighted the incestuous ties between government agencies and local businesses that help to foster corruption and other abuses.

Chen earlier served as governor of the city's Huangpu district, where the real estate group is based. The agency in charge of managing state assets in the district controls Shanghai New Huangpu Group.

According to the Caijing report, officials at another local company, China Huawen Investment Co, allegedly used funds from the city pension fund to buy shares in Shanghai New Huangpu Real Estate. Chen's son, Chen Weili, is a manager at China Sports Media Co, a company controlled by New Huawen, it said.

Wang was also replaced as a vice president of China Huawen, Shanghai New Huangpu Real Estate said in its announcement.