In 2006 and 2007, Xiaoshu Feng bought a stake in three companies that were planning an IPO. The stakes were in the name of his mother-in-law and sister-in-law and bought through investment holding companies, the CSRC said. The transaction amount totalled RMB 251m.
The three companies involved are Shenzhen-listed Jiangsu Yuyue Medical Equipment & Supply, Sanchuan Wisdom Technology and Guangdong Biolight Meditech, the CSRC noted.
After the three companies were listed, Feng doubled his investments by selling the stocks during the period of 2011 to 2015 and made a profit of RMB 248m in total, it noted.
“Feng’s actions have violated the securities law and seriously disturbed order in the securities market,” the regulator said.
Feng was fined RMB 251m ($36.5m) in addition to the confiscation of the gains he made, and was banned from the securities market for life, CSRC said in a statement. (in Chinese 1,2)
“Iron has to be hard itself in order to strike others,” the regulator explained. “The CSRC has made stricter oversight on critical departments, staff and processes to safeguard the stable development of the capital markets.”
Feng, 52 years old, had been working at the Shenzhen bourse since 1996. In 2004, he became the deputy director of the public offering supervision division, where he served until 2012. From 2004 – 2007, he was also a member of the CSRC’s public offering review committee.
