September 23, 2015 / 4:10 AM / 4 years ago

China prosecutor to intensify financial markets crackdown

BEIJING (Reuters) - China’s state prosecutor will intensify its crackdown on criminal activities in its stock and futures markets, following a series of high-profile cases involving one of the country’s market regulators and securities firms.

The prosecutor told a news conference in Beijing it would strengthen coordination with market regulators as part of efforts to halt activities such as insider trading and spreading of false information, state radio said on its website on Wednesday.

The authorities have stepped up investigations on market participants since June, when wild gyrations sent the equity market down as much as 40 percent. Amid the crackdown, investors, fund managers and watchdog officials have all been the subject of investigations.

The China Securities Regulatory Commission (CSRC) said on Sept. 18 it has recently started investigating 19 cases of suspected illegal share sales and speculative activities.

Meanwhile, executives at the country’s largest broker CITIC Securities Co Ltd (600030.SS), including its general manager, are being investigated by authorities for alleged offences including insider trading and leaking information.

The country’s securities watchdog has also been swept up in the crackdown. China’s Communist Party sacked CSRC Assistant Chairman Zhang Yujun, state media reported on Sept. 22, days after it was announced he was the subject of a graft probe.

The campaign to identify and punish those deemed responsible for the market sell-off started shortly after June’s turmoil. However, most analysts attribute the summer crash to the bursting of a typical stock market bubble which was earlier spurred by official media and fueled in large part by borrowed money.

Reporting by Winni Zhou, Meng Meng and Ben Blanchard; Editing by Jacqueline Wong

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