Chinese traders opened the new year in a muted tone after a week-long vacation. (Photo : Getty Images)
China Securities Regulatory Commission (CSRC) fined Liu Qintao 150,000 yuan ($22,800) for a stock market advice based on speculations. He advised the public on June 2, 2015, to take a short position on shares of a rail company.
The regulator notes that Liu's stock advice was viewed more than 42,700 times. Liu is considered China's "god of stocks." His expertise in stock market trading, despite the bourses being volatile, shielded him from heavy losses, notes Sina.
Following the imposition of the fine, the CSRC urged investors on Wednesday to take extra caution when publishing and sharing stock market information, especially those based on rumors. The agency blames those speculations for causing panic and disorder in the country's stock market and undermining market confidence as well as causing losses to investors and the country.
The scrutiny of China's stock market is part of the investigation on the bourses being made by the Communist Party of China. In early January, the party began a probe on Yang Zezhu, chairman of Changjiang Securities, a mid-size stock brokerage firm, for breaching the party's discipline for "personal reasons."
In April 2015, Changjiang sold its 14.7 percent stake in the company for 10 billion yuan ($1.5 billion) to investor and billionaire art collector Liu Yiqian who purchase the shares from Qingdao Haier Investment & Development Co. The CSRC said the acquisition lacked the regulator's approval.
Other brokers being probed by the party include Yim Fung, head of Hong Kong-based Guotai Junan International Holdings Ltd., and Xu Xiang, the top hedge fund trader, for their market transactions. So far, almost 200 Chinese have been punished for spreading stock market rumors.
