A leading mainland economist has called for the disciplining of financial intermediaries involved in the Guangxia (Yinchuan) Industry stock scandal. Wu Xiaoqiu, a professor at the People's University in Beijing, also made a thinly veiled criticism of China's stock-market regulators, according to the Securities Times newspaper. Ningxia-based Guangxia is being investigated by the China Securities Regulatory Commission (CSRC) after the Beijing-based Caijing magazine accused its wholly owned subsidiary Tianjin Guangxia Group of inflating a wide range of financial reports. Guangxia's shares have been suspended from trading. Chinese regulators have focused on banks and investment funds in the investigations of previous stock scandals. However, Mr Wu said Guangxia's accountants and auditors, alongside its management, should be held responsible for gross inaccuracies in the company's financial data in the past two years. Describing accountants and auditors as the first market gate-keepers, he said their loss of professional ethics had 'paved the way for the listed company to dispense bogus information'. 'The regulators' professionalism and sensitivity to market irregularities also leave room for further improvements,' Mr Wu said, referring to the fact that the CSRC probe was prompted by the Caijing story. Also to be held liable, Mr Wu said, were Guangxia's major shareholders, who were responsible for helping the firm prop up its share price. Guangxia's share price soared 440 per cent last year. Electronic equipment maker Shanghai Jinling disclosed yesterday it had invested more than 220 million yuan (about HK$206.14 million) in 7.12 million Guangxia shares. Jinling's shares were suspended from trading for one and a half days from Thursday. Its stock fell 0.64 per cent to 9.24 yuan in trading yesterday. Mutual fund Jinghong, another Guangxia shareholder, gained 2.15 per cent to close at 0.95 yuan, after hitting a record low of 0.93 yuan on Thursday. On June 30, Jinghong held 214 million yuan worth of Guangxia shares, or 6.73 million shares based on that day's price.