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Tencent said in a statement: "An internal investigation brought to light bribery and corruption among some online video employees. The police have been notified and we are awaiting for the results."
Tencent, which is based in Shenzhen, is China's biggest social network and a major online games company. It said Friday six former employees of its online video business had been arrested, but didn't disclose the names of the individuals.
Liu, 39, whose English name is Patrick, is vice president of Alibaba and general manager of the e-commerce OSTV unit. He is a key player in spearheading founder and executive chairman Jack Ma's plan to expand Alibaba's entertainment business.
Alibaba said it was "shocked" by the news in a posting on its social media site. The company previously said in a statement that the issue was nothing to do with Alibaba and related to Liu's time at Tencent.
Tencent has more than 550 million monthly users for its WeChat social media service, and also has movie deals with HBO and a film unit, Tencent Movie Plus.
President Xi Jinping has been running a swinging campaign to root out corruption in China, whether it involves massive wealth accumulated by the powerful "tigers" of the elite or backhanders palmed over to the "flies" at the bottom of the Communist Party.
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It has claimed some senior targets. A number of top presenters on China's state broadcaster China Central Television (CCTV) have been arrested, including one of China's most popular news anchors, Rui Chenggang, who was detained just before he was due to go on air to make his nightly broadcast.
In January 2014, the sudden death of film production company Beijing Galloping Horse's founder and chairman, Li Ming, reportedly occurred while he was aiding authorities with a corruption investigation.
And a broader moral crusade linked to the anti-corruption crackdown has also nabbed big names such as Jaycee Chan, the son Hong Kong action star Jackie Chan, and the Golden Bear-winning director Wang Quan'an, who was arrested last September for paying for sex.
Other recent high-profile figures caught up in the anti-corruption dragnet include China's ex-security tsar Zhou Yongkang and the former China chief of pharmaceutical firm GlaxoSmithKline, Mark Reilly.
This story first appeared in The Hollywood Reporter.