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Monday, 10 November 2008
CSRC crackdown exposes 66 cases of securities offences
The China Securities Regulatory Commission imposed fines and other penalties in connection with 66 cases of illegal securities trade in the first nine months of the year.
CSRC crackdown exposes 66 cases of securities offences
Frederick Yeung 10 November 2008
The China Securities Regulatory Commission imposed fines and other penalties in connection with 66 cases of illegal securities trade in the first nine months of the year.
The stock market regulator launched investigations into 93 cases of illegal market activities in the period, including insider trading, market manipulation and violation of information disclosure regulations, according to a Xinhua report.
The CSRC had seized 153 million yuan (HK$173.75 million) connected with the illegal trading cases, and imposed fines of 146 million yuan on more than 200 individuals from the 66 cases.
This compares with a total of 54 convictions last year. Fines for the first nine months already exceed the total for the whole of last year.
The news report came as CSRC recently completed an investigation into an allegation that a consultant at an investment firm manipulated the share price of stocks which the firm had recommended to the public, a source with the CSRC told mainland media, adding that details of the case would soon be announced.
“All the money the firm gained from illegal trading will be confiscated, and the company will face a fine of about 100 million yuan, which could be the biggest punishment on the mainland on a personal basis,” the source said.
In another case, the China Securities Journal reported an unlicensed broker was fined after having illegally collected commissions totalling 7.2 million yuan from 200 investors.
The regulator had also revoked the stock trading licences of 13 market participants, and 16 people were banned from being involved in stock trading activities permanently.
“The CSRC increased the effort to impose punishment on illegal activities this year,” the source said.
“The regulator has issued 43 punishment announcements and 23 cases of bans of involvement in stock market activities.”
The CSRC has punished 34 firms so far this year, including 17 listed companies, seven accounting firms, seven futures companies and six securities houses.
The regulator also noted a new trend in illegal securities trading. Previously, stock traders manipulated shares through big amounts of capital.
But with the growth in the scale of the stock market, new illegal activities such as “rat trading” had emerged, where securities brokers, in particular floor traders, carry out a wide range of malpractices to the disadvantage of clients.
The CSRC has also stepped up efforts to boost corporate governance.
The regulator recently took Hong Kong and Shanghai-listed China Railway Group to task for poor corporate governance.
A CSRC investigation found China Railway lacked proper procedures in setting the salaries of senior management and noted that last year’s salaries had still not received approval from the board of directors and shareholders.
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CSRC crackdown exposes 66 cases of securities offences
Frederick Yeung
10 November 2008
The China Securities Regulatory Commission imposed fines and other penalties in connection with 66 cases of illegal securities trade in the first nine months of the year.
The stock market regulator launched investigations into 93 cases of illegal market activities in the period, including insider trading, market manipulation and violation of information disclosure regulations, according to a Xinhua report.
The CSRC had seized 153 million yuan (HK$173.75 million) connected with the illegal trading cases, and imposed fines of 146 million yuan on more than 200 individuals from the 66 cases.
This compares with a total of 54 convictions last year. Fines for the first nine months already exceed the total for the whole of last year.
The news report came as CSRC recently completed an investigation into an allegation that a consultant at an investment firm manipulated the share price of stocks which the firm had recommended to the public, a source with the CSRC told mainland media, adding that details of the case would soon be announced.
“All the money the firm gained from illegal trading will be confiscated, and the company will face a fine of about 100 million yuan, which could be the biggest punishment on the mainland on a personal basis,” the source said.
In another case, the China Securities Journal reported an unlicensed broker was fined after having illegally collected commissions totalling 7.2 million yuan from 200 investors.
The regulator had also revoked the stock trading licences of 13 market participants, and 16 people were banned from being involved in stock trading activities permanently.
“The CSRC increased the effort to impose punishment on illegal activities this year,” the source said.
“The regulator has issued 43 punishment announcements and 23 cases of bans of involvement in stock market activities.”
The CSRC has punished 34 firms so far this year, including 17 listed companies, seven accounting firms, seven futures companies and six securities houses.
The regulator also noted a new trend in illegal securities trading. Previously, stock traders manipulated shares through big amounts of capital.
But with the growth in the scale of the stock market, new illegal activities such as “rat trading” had emerged, where securities brokers, in particular floor traders, carry out a wide range of malpractices to the disadvantage of clients.
The CSRC has also stepped up efforts to boost corporate governance.
The regulator recently took Hong Kong and Shanghai-listed China Railway Group to task for poor corporate governance.
A CSRC investigation found China Railway lacked proper procedures in setting the salaries of senior management and noted that last year’s salaries had still not received approval from the board of directors and shareholders.
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