MARKETS-CHINA/CONFESSION China state media announces confessions in probes into stocks plunge

Record ID: 135057

  • Title: MARKETS-CHINA/CONFESSION China state media announces confessions in probes into stocks plunge
  • Date: 1st September 2015
  • Summary: BEIJING, CHINA (RECENT - AUGUST 27, 2015) (REUTERS) EXTERIOR OF CHINA SECURITIES CO. LTD STOCK MARKET BUILDING MAN SMOKING UNDER SIGN READING (English): "CHINA SECURITIES CO., LTD/MAN WALKING INSIDE VARIOUS OF STOCK INVESTORS WATCHING SCREEN SHOWING STOCK INFORMATION
  • Embargoed: 16th September 2015 13:00
  • Keywords:
  • Location: China
  • Country: China
  • Topics: General
  • Reuters ID: LVA7GM4O1VTTVPLBRRVO26RUGQ9T
  • Aspect Ratio: 16:9
  • Story Text: EDITORS PLEASE NOTE: THIS EDIT CONTAINS MATERIAL WHICH WAS ORIGINALLY 4:3
    Chinese state media announced a slew of confessions on Monday (August 31) following investigations into dramatic stock market fluctuations, including from a reporter who said he had spread false information that had caused "panic and disorder".
    An official from China's securities regulator, and four senior executives from China's largest brokerage, CITIC Securities, confessed to insider dealing, the official Xinhua news agency reported.
    China is trying to restore value to its stock markets, where shares have lost around 40 percent since mid-June on concerns over the slowing economy and a devaluation of the yuan in mid-August.
    Authorities have announced crackdowns on fabricated trading information, alleged malicious short selling and other strategies seen as weakening confidence in the stock market.
    Wang Xiaolu, a reporter at the respected Caijing business magazine, read a confession about his reporting on the stock market on which was aired on Chinese state broadcaster CCTV on Monday (August 31).
    "At such a sensitive time, I shouldn't send out a report that would have huge, negative effects on the market. I shouldn't have sought to make a big splash just for the sake of sensationalism. Just to get people's attention, I inflicted huge losses on the country and investors," Wang told CCTV.
    It was not possible to verify whether Wang was forced to make the confession or did so of his own free will.
    Chinese state media often publish confessions of those detained in high-profile cases before they are tried in court, a practice that rule of law advocates say violates the rights of the accused to due process.
    CCTV said Wang had confessed to writing about the Chinese stock market "based on hearsay and his own subjective guesses".
    Caijing could not be reached for comment. In a statement last Wednesday (August 26), a day after Xinhua said Wang was being held, Caijing said it had not been given a reason for his detention, adding it would support his actions within the normal course of reporting. It was unclear if Wang had a lawyer.
    CCTV also said Liu Shufan, an official with the China Securities Regulatory Commission (CSRC), had confessed to insider trading, forging official seals and using his position to boost a company's share price in return for several million yuan of bribes. It was unclear if Liu had been detained or had a lawyer.
    "I consciously broke the law with no regards for it. I think I lack even the very minimum of reverence for the law. I violated criminal law. I should be severely punished. As a (Communist) Party member, I betrayed the trust of the organisation, and years of nurturing and education," Liu told CCTV.
    The CSRC could not be reached for comment.
    Xinhua added that Xu Gang, Liu Wei, Fang Qingli and Chen Rongjie, whom it described as senior executives at CITIC Securities, had confessed to insider trading, although it gave few details.
    A CITIC Securities spokesman declined to comment. On Sunday, the brokerage said several senior managers had been asked to assist with a public security investigation and that the company was actively cooperating with the request.
    It was unclear if the four were being detained or had legal representation.
    Eight CITIC employees were being investigated for suspected illegal securities trading, Xinhua has previously said.
    It has not said if that investigation is linked to the one involving the CSRC official.
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