China detains Citic Securities managing director, three other senior officials and financial journalist over alleged inside trading

The managing director of Citic Securities, Xu Gang, and three other of the brokerage’s senior officials have been detained for alleged inside trading, state-run Xinhua reported on Monday.

In addition to the four people from Citic Securities, the authorities have also held a journalist from Caijing magazine and an employee of the China Securities Regulatory Commission.

Xinhua said Xu, who is also an executive committee member of the brokerage, was taken into custody on Sunday. Also held were executive committee member Liu Wei; Fang Qingli, the head of the company's securities financing business; and company director Chen Rongjie.

The report said Caijing journalist Wang Xiaolu fabricated and spread false information related to securities trading.

In an article published on July 20 – soon after the government unleashed hundreds of billions of yuan to bail out the beleaguered market – Wang wrote that the CSRC was preparing an exit plan. The regulator denied the story.

Xinhua said Wang told investigators that his article was based on his personal assessment and information he had gleaned about the stock market, but he did not verify it.