Mon, Sep 02, 2013 - Page 14 News List

Everbright Securities executives resign after record fines

‘WRONG MEASURES’:The Chinese broker was fined US$85 million over insider trading. Four of its executives are banned from the markets for life

Bloomberg

Everbright Securities Co (光大證券), the company that roiled China’s equity market two weeks ago with errant trades, said two executives resigned amid record penalties imposed by regulators after an investigation.

Everbright assistant president Yang Chizhong (楊赤忠) and board secretary Mei Jian (梅鍵) tendered letters of resignation to the board on Saturday, according to two statements the company submitted to the Shanghai Stock Exchange. Everbright vice president Xue Feng (薛峰) was appointed acting board secretary until a replacement is found, it said.

The broker was fined a total of 523 million yuan (US$85 million) after an investigation into 23.4 billion yuan of erroneous buy orders found it traded on inside information, the China Securities Regulatory Commission (CSRC) said.

Yang and Mei were fined 600,000 yuan and 200,000 yuan respectively, it said.

“This incident exposed big problems in our internal control, risk management and rule-abiding operations,” the statement said.

“The company and relevant personnel took wrong measures” that constituted insider trading, giving misleading information and other illegal activities, it said.

Four people, including former Everbright president Xu Haoming (徐浩明), are to be banned from markets for life and the brokerage was barred from most proprietary trading, CSRC said. Xu resigned last week and the brokerage suspended Yang Jianbo, the head of its proprietary trading business.

The firm estimated it lost 194 million yuan on the trades, based on Aug. 16 closing prices, and said the figure may change.

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