Latest News:  
Beijing   Sunny    4 / -7   City Forecast

People's Daily Online>>China Business

Market ills haunt regulators

By Fang Yunyu (Global Times)

08:16, January 13, 2012

China’s top securities watchdog still has a long way to go to better protect retail investors, though it has vowed to ”firmly crack down on illegal activities, including insider trading,” experts said yesterday.

Guo Shuqing, the new chairman of the China Securities Regulatory Commission (CSRC), said insider trading and ”rat trading”, in which brokers and staff in securities companies make use of insider information to secure illicit gains, are thefts. The regulator would ”firmly investigate and punish such thieves in the market.”

In addition, the watchdog vowed to strengthen market supervision, enhance securities regulation, as well as enforce checks on listed companies which is the ”most direct and effective way” to protect the confidence of investors.

"However, our country lacks a comprehensive legislative and protection mechanism for retail investors,” Li Weidong, research director at consultancy China Venture, told the Global Times yesterday, adding that he thinks the market itself rather than the commission should play a bigger role in the supervision of the market.

Currently, all initial public offering applications are required to be approved by the commission. And there is no compensation mechanism for investors if they suffer losses due to insider trading.

Yi Xianrong, an economist at the Chinese Academy of Social Sciences, told the Global Times earlier that the most pressing task is to improve the health of the country’s stock markets, as in the last few years the markets have turned into a ”money collection market.”

The top regulator said on its website Wednesday that 387 cases of illegal activities were investigated between 2008 and 2011, and a total of 829 million yuan ($131.32 million) worth of fines were imposed on offenders. The commission also investigated 154 cases of insider trading during the four years.

Economist Lang Xianping said he thinks insider trading punishments are ”too light”, because the fine can only go up to 3 million yuan, which is not big enough to frighten people engaging in illegal activities.

The commission at the end of last year disclosed five cases of market manipulation and insider trading, and in one such case, an executive of a securities company earned about 20 million yuan from insider trading.

"Of course, beefing up supervision of the bourses is a good thing, but another question is who will supervise the commission?” a securities analyst told the Global Times, requesting anonymity.

The watchdog announced Tuesday it has established an investor protection bureau, a move believed to better protect the rights and interests of investors in the capital markets.

Email|Print|Comments(Editor:王莉莉)

Leave your comment0 comments

  1. Name

  

Selections for you


  1. China’s first AHLC in training

  2. 23rd Tokyo Int'l Jewellery Exhibition opens

  3. 90th European Motorshow opens in Brussels

  4. 5-week-long winter sales begin in Paris, France

Most Popular

Opinions

  1. Why Russia's aircraft carrier visits Syrian port
  2. Central grain reserves turn into 'market stabilizer'
  3. A priority for Asia-Pacific shift
  4. Will US decline soon?
  5. High-level visits can boost Sino-US ties
  6. S.Korea, China can pull up from their nosedive
  7. Helping Iran weather a looming storm
  8. Give up copying US standards without question
  9. How to make 3 billion trips in 40 days
  10. Greater say needed on yuan's convertibility

What's happening in China

Cold front hits Hulunbuir, China's Inner Mongolia

  1. Chinese language HC interaction software debuts
  2. Xiushan Tunnel of the Pan-Asia Railway completed
  3. HK’s foreign reserves top $285 billion
  4. Ticket booklet for 115 Beijing museums on sale
  5. Taiwanese missing out on voting

PD Online Data

  1. Yangge in Shaanxi
  2. Gaoqiao in Northern China
  3. The drum dance in Ansai
  4. Shehuo in Baoji City
  5. The dragon dance