The tale of Chinese journalist Chen Yongzhou of the New Express Daily and Zoomlion, a maker of diggers and concrete mixers, must seem completely bizarre to anyone outside of China. But it holds important lessons for investors, especially those holding bonds.

The tabloid reporter was arrested last month then confessed on live TV to taking bribes to help an unidentified party defame the accounts of a large publicly listed, government-backed company.

It sounds like a thriller, but it has become a lengthy saga involving accusations and denials of fraud and corruption flying in all directions, protests over press censorship from the newspaper and then an embarrassing retraction.