China Fines Former Exchange Official $36 Million for IPO TradesBloomberg News
Feng Xiaoshu will also forfeit 248 million yuan in gains
CSRC is taking tough approach to capital market violations
China’s securities regulator fined a former stock market official 251 million yuan ($36 million) for illegal stock trading activities.
Feng Xiaoshu, once a member of the Shenzhen Stock Exchange’s committee for listings approvals, bought shares of companies before they went public and sold them afterward, said Zhang Xiaojun, a spokesman for the China Securities Regulatory Commission. Feng will also forfeit the 248 million yuan he gained by dealing the shares through relatives’ stock accounts, and was banned for life from working in the securities industry, Zhang said at a press conference in Beijing on Friday.
The penalty underscores Chinese regulators’ continued high pressure on capital market violations. In February, the CSRC imposed 3.47 billion yuan in penalties on a former controller at Guangxi Future Technology Co., and the next month penalized another trader 1.17 billion yuan in two cases of stock market manipulation. CSRC Chairman Liu Shiyu said in February he will purse traces of wrongdoings “no matter they’re historical or current.”
Feng’s trades caused “severe disruptions” to capital markets, Zhang said.
The Shanghai Stock Exchange probed 159 cases of trading irregularities and halted trading in some accounts this week after Liu urged the country’s bourses to punish market irregularities “without mercy.”
— With assistance by Tian Chen, Amanda Wang, and Gary Gao