SHANGHAI Feb 18 A Beijing court has agreed to
accept a lawsuit filed against China's securities regulator by
the former head of a trading unit at Chinese brokerage
Everbright Securities, who is contesting the
punishment he received for insider trading.
Yang Jianbo, former general manager of a high-frequency
trading unit at Everbright, and three colleagues were banned for
life from the securities industry and fined 600,000 yuan
($99,000) each by the China Securities Regulatory Commission
(CSRC) in late August after its investigation determined that
they had committed insider trading.
Yang's lawyer, Li Jiang, a partner at the Beijing-based
Zhong Zhao Law Firm, submitted a complaint to Beijing First
Intermediate Court on Feb. 8.
"The court has accepted the suit. Now we'll move forward
with the case according to normal legal procedure," Yang told
Reuters by telephone on Tuesday.
The CSRC found that after a computer malfunction during
morning trade on Aug. 16, which caused Everbright to take a 7.27
billion yuan long position in a commonly-traded exchange-traded
fund, Yang and his colleagues committed insider trading by
partially unwinding that position in afternoon trade without
properly disclosing the original trading error.
Yang claims that the existence of a trading error doesn't
qualify as inside information and that subsequent trades
designed to unwind them were in line with the unit's normal
hedging strategy, not an exceptional response to the mistaken
(Reporting by Gabriel Wildau; Editing by Jeremy Laurence)