New | Beijing cracks the whip again on brokerages
240m yuan to be fined and confiscated from Huatai, Haitong, GF, Founder and Zheshang
The China Securities Regulatory Commission on Friday announced punitive action against five brokerages, refusing to let up the regulatory crackdown even as the stock markets showed signs of stabilising.
A total of 240 million yuan will be fined and confiscated from Huatai Securities, Haitong Securities, GF Securities, Founder Securities and Zheshang Futures for their "insufficient inspection and understanding of clients' identity", the regulator said in an announcement.
The listed companies confirmed the fines and admitted failures in their procedures in statements filed on the Hong Kong and Shanghai stock exchanges late on Friday.
The CSRC has been cracking the whip on "errant" financial institutions it blames for the stock slump.
Some financial institutions have been connecting their clients with illegal trading platforms offering high-leverage margin trading, one of the factors that had pushed stocks to stratospheric levels in the bull run before a stock market rout in mid-June.
These platforms, including Hundsun Technologies, partly owned by Alibaba founder Jack Ma Yun's financial investment company, were fined 453 million yuan in total. Four of the fined securities firms pointed to Hundsun's system in stock filings.
A further 151 million yuan of "illicit gains" were confiscated by the CSRC earlier this month.