SFC infographic.
The China Securities Regulatory Commission adheres to "zero tolerance" law enforcement,
Concentrate on dealing with illegal stock speculation by a number of practitioners
In order to thoroughly implement the spirit of the Central Financial Work Conference, comprehensively strengthen financial supervision, and adhere to the supervision of "long teeth and thorns", recently, our association organized inspection and law enforcement, daily supervision forces to focus on investigating and prosecuting violations of laws and regulations such as stock trading by many employees of China Merchants Securities. Rely on criminal accountability, administrative punishments, administrative supervision measures, and internal accountability to carry out three-dimensional punishments.
First, administrative penalties were imposed on 63 people, with a total fine of 81.73 million yuan, and 1 person was banned from the securities market for life. The second is to transfer one person suspected of insider trading to the judicial authorities for handling. The third is to take administrative supervision measures against 46 people, of which 3 people are to be identified as inappropriate persons, 5 people will be subject to supervision talks, and 38 people will be issued warning letters. Fourth, China Merchants Securities, which is responsible for the management of employees, will take administrative supervision measures such as ordering an increase in the number of compliance inspections, issuing a warning letter to the chairman of the company and taking regulatory talks with the two then compliance directors, and urging China Merchants Securities to initiate internal accountability, interview relevant violators, and implement full accountability coverage.
It is a basic requirement of the Securities Law that securities practitioners are not allowed to buy or sell stocks. In recent years, we will crack down on securities practitioners who buy and sell stocks in violation of regulations. From 2019 to 2023, a total of 67 cases of illegal stock speculation by practitioners were investigated and handled, and 139 people were punished administratively, focusing on building a long-term mechanism of "not daring, can't, and not wanting to" illegal stock trading.
In the next step, I will adhere to systematic thinking, draw inferences from one example, continue to strengthen institutional supervision, behavior supervision, functional supervision, penetrating supervision, and continuous supervision, and cooperate with industry associations to continue to carry out the following work: First, improve the system and mechanism. Formulate a special rectification work plan to strictly crack down on illegal stock speculation by securities practitioners in accordance with the law, consolidate the main responsibilities of institutions, urge securities companies to strengthen internal monitoring, self-examination and self-correction and accountability mechanisms, implement compliance management for all employees, and realize the integrated vertical management of all branches and employees, and each securities regulatory bureau will carry out special on-site inspections. Improve the rules for the management of employees' investment behavior, urge institutions to improve the internal control system for investment declaration, review, monitoring, punishment, etc., improve the investment behavior management mechanism, and further plug the loopholes in the regulatory system and implementation of securities practitioners. The second is to strengthen supervision and law enforcement. "Crack down on violations", strictly hold accountable institutions with ineffective control, strengthen a three-dimensional punishment system for violators, build a punishment mechanism of "one violation, everywhere restricted", strengthen the notification and warning of violations, and carry out special governance actions. The third is to continue to purify the industry ecology. Adhere to the "two combinations", carry out in-depth comprehensive management of industry culture construction, and urge institutions to effectively achieve "not exceeding the bottom line, not seeking profit, not rushing for quick success, not detaching from reality to virtuality, and not acting recklessly", and adhere to honesty and trustworthiness, righteousness and profit, prudence, integrity and innovation, and compliance with laws and regulations. Improve the basic norms and codes of conduct for practitioners, establish and complete a system of classified lists of practitioners and mechanisms for managing professional reputation, and accelerate the formation of an atmosphere of "strict" management of practitioners.
Appendix: Biography of the Chairman of the Board of Directors of China Merchants Securities Official Website:
Mr. Huo Da is the chairman, executive director and chief information officer
He has served as the chairman and executive director of the Company since May 2017 and the Chief Information Officer of the Company since March 2022. He used to be the chief staff member, deputy director and director of the China Securities Regulatory Commission, the assistant director of the Shenzhen Supervision Bureau of the China Securities Regulatory Commission, the deputy inspector, deputy director and director of the Market Supervision Department of the China Securities Regulatory Commission, the director of the Corporate Bond Supervision Department of the China Securities Regulatory Commission, the director of the Research Center of the China Securities Regulatory Commission, the president of the Beijing Securities and Futures Research Institute, the president of the China Securities Financial Research Institute, the part-time member of the 17th Issuance Review Committee of the China Securities Regulatory Commission, the director of China Merchants Securities International Co., Ltd., and the chairman of China Merchants Zhiyuan Capital Investment Co., Ltd.
Hoda data map.
Mr. Huo Da obtained a bachelor's degree in engineering from Huazhong University of Science and Technology (formerly Huazhong University of Science and Technology), a master's degree in economics from Huazhong University of Science and Technology (formerly Huazhong University of Science and Technology) and a doctorate degree in economics from the China Academy of Fiscal Sciences (formerly the Institute of Fiscal Sciences of the Ministry of Finance) in July 1989, April 1994 and January 2008, respectively.
Shenzhen Securities Regulatory Bureau
The decision to issue a warning letter to Hoda
Hoda:
After investigation, a number of employees of China Merchants Securities Co., Ltd. (hereinafter referred to as China Merchants Securities) had borrowed other people's securities accounts to trade stocks for a long time, privately accepted customer entrustment to trade stocks, entrusted others to speculate in stocks, and other violations of laws and regulations, which reflected that the company's compliance and internal control management was not in place, violating the provisions of Article 6, Item 4 of the Measures for the Compliance Management of Securities Companies and Securities Investment Fund Management Companies (Decree No. 166 of the CSRC, hereinafter referred to as the "Compliance Management Measures").
As the chairman of China Merchants Securities, you have management responsibility for the above issues. In accordance with the provisions of Paragraph 1 of Article 32 of the Compliance Management Measures, our bureau has decided to take administrative supervision measures against you by issuing a warning letter.
If you are not satisfied with this administrative supervision measure, you may file an application for administrative reconsideration with the China Securities Regulatory Commission within 60 days from the date of receipt of this decision, or you may file a lawsuit with the people's court with jurisdiction within 6 months from the date of receipt of this decision. During the period of reconsideration and litigation, the implementation of the above-mentioned administrative supervision measures shall not be suspended.
Shenzhen Securities Regulatory Bureau
January 2024