Party disciplinary bodies deny ownership of shares

PUBLISHED : Friday, 01 May, 2009, 12:00am
UPDATED : Friday, 01 May, 2009, 12:00am

Two Sichuan Communist Party disciplinary bodies yesterday denied reports about their possession of shares in three mainland companies, saying the assets had been confiscated during an investigation.

Mainland news websites said on Wednesday that the southwestern province's Communist Party Disciplinary Committee and the Supervision Department Service Centre held stocks in Henan Oriental Silver Star, Chinascholars Group Company and Zhongyuan Environmental Protection. A Xinhuanet report quoted a report from Chinascholars Group, a telecommunications manufacturer registered in Fuzhou, Fujian, as saying that the two disciplinary bodies comprised the second-largest holder of shares in the company, with 1.6 million free-flow shares, 0.66 per cent of the total.

An Oriental Silver Star report revealed the committee and the service centre were together the fourth-largest holder of its free-flow shares, holding 931,800 shares, 1.02 per cent of the total.

The magazine Finance Weekly said the disciplinary bodies also held 303,300 shares in Henan-based sewerage service and heat supplier Zhongyuan Environmental Protection and was the fourth-largest holder of its free-flow shares.

The shareholder base of each of these companies is small and the free flow of shares is about 1 billion yuan (HK$1.14 billion) per season, which means they can be manipulated easily. Prices of the stocks were all below 9 yuan (HK$10.23) yesterday.

But a notice on the official website of the disciplinary bodies said the shares were confiscated from 'many accounts' during an identified investigation, were currently under the surveillance of the Sichuan Finance Department and would go to the national treasury, it said.

'To handle the stocks before passing them to the provincial Finance Department for further action, the committee and supervision department, the two offices responsible for the investigation, put them into an account registered under their names in December and completed the transaction on January 23 with help from the Shanghai and Shenzhen branches of the China Securities Depository and Clearing Corporation,' the notice said. A spokesman for the two offices said they 'had not set foot in the stock exchange and will not do so'.

The Sichuan government also announced yesterday that the People's Congress Standing Committee had decided to remove Yibin vice-mayor Chen Guangli from his post on Tuesday. The committee did not say why, but the Suining Daily reported that a circular about 'Chen and others' playing mahjong was circulated in different cities early last month.