Update | China’s Founder Securities says it cannot reach director amid probe by regulators

Zhao Dajian, honorary chairman of China Minzu Securities and a director of parent Founder Securities, has not been contactable by both firms since September 22, Founder said in a Monday filing to Shanghai’s stock exchange.

“The company will continue to coordinate efforts by various parties, including China Minzu Securities, to get in touch with Zhao Dajian, check on the relevant situation and make disclosures in a timely manner,” Founder said.  

Founder’s shares lost 1.6 per cent to 6.29 yuan at 9:59a.m in Shanghai after trading as low as 6.25 yuan. The Shanghai Composite Index slid 1.1 per cent.

Minzu has been investigated by the mainland’s securities regulator on a matter involving 2.05 billion yuan, Founder said in a stock exchange filing on September 9.

Founder, along with Haitong Securities, GF Securities and Huatai Securities, said in late August the China Securities Regulatory Commission had launched probes into their operations for failing to review and verify client identities. The CSRC has increased its scrutiny of securities firms as markets went into near free-fall.

State media blamed ‘malicious short-selling’ as a major reason for the market crash since mid-June.

Three top executives at the nation’s biggest brokerage Citic Securities have been probed for suspected insider dealing and the leaking of inside information, the company said in a statement to Hong Kong’s stock exchange on September 15.