CSRC fines firm record US$870m for price fixing

China's securities regulator imposed a fine of 5.5 billion yuan for market manipulation.

China Securities Regulatory Commission will lay a huge penalty at a record high of 5.5 billion yuan (US$870 million) for capital market violation, CSRC said at a press conference on Wednesday.

The CSRC made the revelation of three violation cases in the capital market investigated recently, including one case of information disclosure and two market manipulation cases.

Xiamen Beibadao Logistics Group, a private logistics company, will be imposed a fine of 5.5 billion yuan for manipulating share prices.

The regulator said that the company made 945 million yuan by using over 300 trading accounts to manipulate the stock prices of listed companies including two banks, Jiangsu Zhangjiagang Rural Commercial Bank Co Ltd and Jiangsu Jiangyin Rural Commercial Bank, and an industrial firm Guangdong Hoshion Aluminium Co Ltd.

"Beibadao Group made use of the features including small circulation and new concepts of these stocks." said Xia Bing, head of an investigation group at CSRC. "Beibadao's bulk buying misled the investors in their decisions severely."

For instance, Jiangsu Zhangjiagang Rural Commercial Bank jumped sharply by over 600 percent from 4.37 yuan to 30.41 yuan in two months since it was listed in January 2017.

The penalty for Beibadao Group is not an exceptional case. Fro instance, an equities trader was fined 54 million yuan for manipulating 15 stocks to make a profit of 27 million yuan in December last year.

In 2017, the regulator has initiated 478 investigations and newly registered 312 cases, among which the number of serious cases doubled year on year to be 90.

The CSRC said that they will adhere to strict supervision in line with the law to serve the real economy of the capital market and facilitate high-quality development, and to build an open, fair and just market environment.