Justice in China can be mysterious. Related to this, the whereabouts of two top executives from China’s largest brokerage CITIC remain unknown as of late Monday. Only in China….
CITIC noted in a regulatory filing in Hong Kong on Sunday that it could not reach two senior investment bankers, Jun Chen and Jianlin Yan.
Of note, Chinese business publication Caixin claimed last Friday the two execs had been detained. The report did not provide further details about whether the pair were the subjects of an investigation or just assisting with an expanding probe into China’s securities industry.
Analysts highlight that CITIC Securities is one of the Chinese brokerages under investigation by securities regulator for possible violations.
More on missing CITIC execs
The filing on Sunday also noted that several employees of CITIC Securities that had been detained by Chinese authorities have come back to work after assisting with the government investigations.
Based on their online biographies, Chen is head of CITIC’s investment banking division, while Yan is the top man in investment banking at CITIC Securities International.
A number of brokerage execs are currently under investigation in China as law enforcement probes the more than 40% sell off in Chinese stocks this summer. The Chinese authorities have placed a large part of the blame for the stock market meltdown on “malicious short-selling”.
It was already known that some executives at CITIC were ubder investigation or insider trading and leaking information.
CITIC announced last month that it was in the process of choosing a new chairman, and incumbent Wang Dongming was not under consideration due to his age. The Financial Times has reported that Wang was being pushed out because of the ongoing scandal.
The specific reasons for the various probes have not been made public to date, but Reuters reports that knowledgeable sources say many of the investigations related to insider trading by China’s “national team” – the large brokerages and fund managers who were “encouraged” by the government of China to purchase stocks as part of a major effort to support the market.