Four Chinese securities brokeages and employees of its securities regulator are under investigation for alleged stock market offences.
China’s official News Agency, Xinhua, reported that three of the brokerages have confirmed they are being accused of failing to confirm the identities of clients, and that eight employees of another brokerage are suspected of illegal securities trading.
Xinhua also reports that one former and one current employee of the China Securities Regulatory Commission have also been accused of insider trading.
The news report said a journalist is also being investigated on suspicion of spreading fake futures trading and fake securities information.
In July, Chinese authorities said they were investigating possible breaches and misconduct within China’s securities market following the sudden end to a stock price boom.
The authorities said brokerages, among other things, may have been allowing clients to trade without revealing their real names and other violations. They gave no indication on whether the cases were connected.
However some China watchers say at this stage the charges and investigation may not hold any substance, and may be a desperate effort by the ruling Communist Party to deflect blame for the latest economic downturn.
Meanwhile Chinese and Hong Kong markets stabilized today after two days of a downward spiral, closing mostly higher. Experts say Beijing’s latest rate cuts restored some confidence in the market after days of brutal losses. Along with the interest rate cuts, Beijing eased bank lending limits as a measure to stop panic selling bringing them to an eight month low.
China’s Premier Li Keqiang is reported today as saying although current global economic conditions were “bewildering, creating volatility in global markets” the Chinese Government has room to respond innovatively and deploy the correct tools to reach its economic targets.