China’s Carl Icahn is back in the news…
Xu Xiang, the billionaire owner of a Chinese investment firm sometimes called China’s Carl Icahn, was detained on suspicion of insider trading a little over a week ago, and has been held incommunicado ever since. Government regulatory officials continue to move forward with their investigation, as the leadership of the country rolls out new regulatory measures for the financial industry.
The government-controlled China Securities Journal announced on Tuesday that regulatory agencies had frozen stock and bank accounts coming to more than 4.3 billion renminbi ($675 million) owned by a woman identified as Xu’s mother.
More on the downfall of China’s Carl Icahn
There has been no information released regarding the whereabouts or status of the apparently fallen Xu Xiang. His Shanghai-based Zexi Investment did not answer phone calls on Tuesday, although it was after business hours. Zexi’s website had no information regarding Xu, and the Chinese government has also remained completely buttoned up on what has happened to China’s Carl Icahn.
Chinese President Xi presided over a meeting of the party’s leading group on financial issues on Monday afternoon. According to Xinhua news agency, he was joined by three of the six other members of the standing committee of the powerful Politburo.
Xinhua went on to say that the president had called for stronger regulation of stock markets so that investors would always be treated fairly. Analysts point out that Chinese stock markets have a poor reputation due to chronic insider trading (China’s Carl Icahn was widely thought to have access to insider information) and many other systemic abuses.
“We must prevent and ease financial risks,” Xinhua quoted Xi as saying. “Accelerate the formation of stock markets that have full financing functions, robust institutions, effective market supervision, and full protection of investors’ rights and interests.”
Xinhua also announced last Friday that Chinese regulators were planning to remove a moratorium on new stock market listings by the end of December, given that Chinese stock markets have made a notable recovery following a meltdown over the summer.
Also of note, the Shanghai Stock Exchange is examining methods to limit how long companies can suspend trading. Stocks being halted for months at a time on a regular basis has led to mass complaints as investors cannot sell shares (at any price) when they need cash.