SHANGHAI May 19 China's securities regulator
said on Friday it would suspend the launch of Sealand Securities
new asset management products for a year and halt other
operations after a probe into its business found its internal
"The probe found that Sealand Securities has problems
including chaotic internal management, ineffective compliance
and risk management, and many cases of misbehaviors," the China
Securities Regulatory Commission (CSRC) said in a statement
posted on its microblog.
The regulator added it would suspend Sealand Securities' new
account openings and bond underwriting businesses for a year.
The penalties mark the latest move by regulators to clean up
the financial sector, with a focus on shadow banking and
excessive borrowings that fuel speculation in risky investments.
Sealand Securities' executives could not be reached for
comment after Reuters put in several calls to the brokerage late
CSRC's probe into Sealand Securities' bond trading and asset
management business came in the wake of a scandal last December
that triggered a rout in China's bond market.
The scandal involved "forged" bond agreements which the CSRC
said involved deals worth about 20 billion yuan ($2.90 billion)
and 20 financial institutions.
In a separate statement, CSRC said it punished Sinvo Fund
Management Co after a probe found the mutual fund house had lax
risk control and management, resulting in defaults in a
bond-related investment scheme last December.
Calls to Sinvo were not answered.
($1 = 6.8897 Chinese yuan)
(Reporting by Samuel Shen and John Ruwitch; Editing by