Beijing, Nov 13: The deputy chief of China’s top securities regulator is under investigation, state media said today, as the country moves the focus of its sweeping anti-graft campaign to the financial sector months after a stock market rout rocked global markets. The official Xinhua news service said Yao Gang, vice chairman of the China Securities Regulatory Commission (CSRC), has come under suspicion of committing “severe disciplinary violations” — normally a euphemism for graft. (read: South African students win university language victory)
Chinese authorities have been pursuing a hard-hitting campaign against crooked officials since President Xi Jinping took office in 2013, a crusade that some experts have called a political purge.
In October, China’s anti-corruption watchdog said it would expand its inspections to major financial institutions, including the central bank and regulatory authorities, which are already under pressure after a spectacular stock market meltdown.
The announcement last month said that the new round of inspections will cover the central People’s Bank of China, the China Banking Regulatory Commission, China Insurance Regulatory Commission and the CSRC, among a long list of others. China Investment Corp, the world’s largest sovereign fund, commercial banks ICBC and the Bank of China and the country’s major insurance companies will also come under scrutiny.
The anti-corruption watchdog will also examine stock exchange operators in Shanghai and Shenzhen, and the parent company of major brokerage Citic Securities.After soaring 150 per cent in one year, the two bourses went into a tailspin in June that extended into August, tumbling nearly 40 per cent despite massive intervention by the authorities at a cost of hundreds of billions of dollars.
The frantic and clumsy state efforts to stop the bleeding were criticised, with a number of experts questioning the apparent contradiction with Beijing’s intention to give a greater role to the market and private sector.
The CSRC played a lead role in the response to the crisis, including launching probes into “malicious short selling”, which the government said was partly to blame for the chaos, and putting a temporary stop on initial public offerings, a ban that was lifted in a surprise announcement earlier this month. In September, another top CSRC official Zhang Yujun, former manager of the Shanghai stock exchange, was removed from his post on similar charges to Yao (image credits: twitter)