(ATF) Regulators in China have suspended a trading company – Capital Securities – for three months for violations relating to bond transactions.
The China Securities Regulatory Commission (CSRC) announced the punishment on its website, which showed that Capital Securities had two major issues in the second half of 2019.
Firstly, the Commission said the firm had insufficient control over bond transactions, because it filed incomplete reports on bond transactions that did not provide information of the traders' identities and bank accounts.
The second penalty stemmed from the fact the firm had not established a counter-party white list and quota management system for spot bond transactions.
According to relevant laws, the CSRC decided to suspend Capital Securities from being allowed to undertake new purchases – except for bond transactions necessary to prevent liquidity risks. Enforcement of new regulatory measures is being done to increase transparency and as a warning to other traders to show they must pay attention to new rules.
Hexun reported that Zhang Zhiming, as a senior executive and head of the department in charge of the company's fixed-income business, was held responsible for the above-mentioned violations. The CSRC decided to adopt supervisory measures for Zhang Zhiming.
At the same time, the China Securities Regulatory Commission also ordered Beijing Capital Securities to restrict Zhang Zhiming's right to receive remuneration other than his basic salary.
Zhang Zhiming was also ordered to go to the Beijing Securities Regulatory Bureau on June 16, 2020, for a "discussion".
According to its official website, Beijing Capital Securities Co Ltd was established in 2000 and is a securities company controlled by Beijing Capital Venture Group Co Ltd, a subsidiary of Beijing Municipal SASAC.
The current chairman of Beijing Capital Securities is Wu Lishun, a certified public accountant. In 2019 he was appointed as the chairman of Capital Securities.
It is worth noting that on January 31, 2019, the official website of the Beijing Municipal Commission for Discipline Inspection publicly disclosed that Xie was caught while drunk driving official vehicles, when deputy general manager and chairman of Capital Securities. Xie Dechun was fired from public office and spent one month in prison.