China continued its probe this week into recent irregularities in the stock market, naming two more executives of the country’s top brokerage firm CITIC Securities in an investigation into market manipulation and insider trading.
A total of eight employees from CITIC were taken in for questioning by Chinese police on Tuesday along with two officials of the China Securities Regulatory Commission and a reporter for prominent business magazine Caixin accused of spreading false information, the South China Morning Post reported.
The detained brokers, suspected of “malicious short selling” that led to the Chinese stock market’s recent volatility, include CITIC’s managing director Xu Gang and two members of the investment bank’s executive committee named Ge Xiaobo and Liu Wei. They are also suspected of forging government documents.
“The severity of the problem and the depth of the investigations turned out to beat many people’s expectations,” a source connected to CITIC told the SCMP. “It is a sign more influential securities-industry officials will be uncovered as the authorities deepen investigations.”