China's graft watchdog sends inspection teams to review financial authorities
The Communist Party's anti-graft body has started a review of China's financial authorities, including the central bank and the securities watchdog, after a series of scandals in the sector amid the summer's market rout.
Teams sent by the Central Commission for Discipline Inspection (CCDI) held meetings at the People's Bank of China, the China Securities Regulatory Commission (CSRC) and the State Administration of Foreign Exchange over the weekend.
The meetings kicked off a review of the entire industry, which was expected to last two months, the agency said on its website on Saturday.
The teams would conduct thorough checks into whether senior officials at financial authorities had violated party discipline.
In the meetings, the team heads insisted officials adhere to the policy directions set by party leaders. Some officials and sensitive issues would be "targeted", the CCDI said in its statement, without elaborating.
The leadership appears adamant about cleaning up the finance sector after Zhang Yujun, an assistant CSRC chairman, was investigated for serious disciplinary violations.
Read more: Beijing investigates senior figure at China’s state securities regulator in latest step to crackdown on market irregularities
The China Banking Regulatory Commission, the China Insurance Regulatory Commission and the mainland's sovereign fund China Investment Corp will also be investigated.
CCDI head Wang Qishan was a former vice-premier in charge of the financial sector. In September, Zhuang Deshui, a deputy director at an anti-corruption studies research centre, was quoted by as saying Wang had been chasing unscrupulous financial officials for a long time and was determined to uproot irregularities in the industry.
"The investigations would help us find problems and comply with the party's disciplinary rules," CSRC chairman Xiao Gang told officials at the meeting on the weekend.
"It will benefit us to improve our work so as ensure the development of a stable and healthy capital market."
During the stock market rout that began in mid-June, the anti-corruption body uncovered unethical behaviour by officials at the CSRC and major financial institutions.
Read more: China’s central bank tightening internal controls ‘to root out potential corruption’
State-owned media accused some of colluding with overseas investors to profit from the government's massive injections into the market in an attempt to bring stability. A clutch of senior officials including Cheng Boming, the president of Citic Securities, the mainland's largest brokerage, were investigated after the government spent more than 1 trillion yuan (HK$1.2 trillion) on stemming a market collapse, in vain.
The boom-to-bust cycle sparked worries of a potential financial crisis with ripple effects spreading across major equity markets around the world.
Speculation began to mount that more corrupt government and corporate officials would soon be named.
said in September the crackdown on suspicious trading would become a "new norm", suggesting the regulators and investigators would continue to target unethical traders and corrupt officials and hold them responsible for contributing to market turbulence.
