According to the WeChat public account of the China Securities Regulatory Commission, in order to thoroughly implement the spirit of the Central Financial Work Conference, comprehensively strengthen financial supervision, and adhere to the “thorny” supervision, the China Securities Regulatory Commission recently organized inspections and law enforcement and daily supervision forces to investigate and deal with multiple employees of China Merchants Securities Buying and selling stocks and other illegal activities.
The China Securities Regulatory Commission relies on criminal accountability, administrative penalties, 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 one person was banned from the securities market for life. The second is to transfer one person suspected of insider trading to judicial authorities. The third is to take administrative supervision measures against 46 people, of which 3 people will be identified as inappropriate candidates, 5 people will be subject to supervisory interviews, and 38 people will be issued warning letters. The fourth is to take administrative supervision measures against China Merchants Securities, which is responsible for the management of employees, by ordering the company to increase the number of compliance inspections, issuing a warning letter to the chairman of the company, and taking supervisory talks with the two then-compliance directors, and supervising China Merchants Securities. Securities initiated internal accountability, interviewed relevant violators, and implemented full coverage of accountability.
The China Securities Regulatory Commission emphasized that it is a basic requirement of the Securities Law that securities practitioners are not allowed to buy or sell stocks. In recent years, the China Securities Regulatory Commission has severely cracked down on illegal stock trading by securities practitioners. From 2019 to 2023, a total of 67 cases of illegal stock trading by employees were investigated and administrative penalties were imposed on 139 people. We strive to build a long-term mechanism for “dare not, cannot, and don’t want to” illegal stock trading.
The China Securities Regulatory Commission pointed out that in the next step, it will adhere to systematic thinking, draw inferences from one example, continue to strengthen institutional supervision, behavioral supervision, functional supervision, penetrating supervision, and continuous supervision, and collaborate with industry associations to continue to carry out the following work in depth:
The first is to improve the system and mechanism. Formulate a special rectification work plan to severely crack down on illegal stock trading by securities practitioners in accordance with the law, consolidate the responsibilities of institutional entities, urge securities companies to strengthen internal monitoring, self-examination, self-correction and accountability mechanisms, implement compliance management for all employees, and achieve control over all branches Integrated vertical management of institutions and practitioners, each securities regulatory bureau will carry out special on-site inspections. Improve the investment behavior management rules for practitioners, urge institutions to improve internal control systems such as investment declaration, review, monitoring, and punishment, improve the investment behavior management mechanism, and further plug loopholes in the supervision system and implementation of securities practitioners.
The second is to strengthen supervision and law enforcement. We will punish violations as soon as they appear, strictly hold institutions with poor management and control accountable, strengthen a three-dimensional punishment system for violators, build a punishment mechanism where “violation occurs once, and restrictions are imposed everywhere”, strengthen 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 “not cross the bottom line, not be mercenary, not eager for quick success, not deviate from reality, and not act recklessly”, adhere to honesty and trustworthiness, make profits with justice, and Be prudent, upright and innovative, and comply with laws and regulations. Improve the basic norms and codes of conduct for practitioners, establish and improve a classification list system for practitioners and a professional reputation management mechanism, and accelerate the formation of a “strict” atmosphere for practitioner management.