Chinese Regulator Launches Probe into CITIC

After the revelation of a reporting error, the broker becomes target of a full-blown investigation.

The Securities Association of China has started an investigation into CITIC Securities, a day after it announced an error that had inflated its derivatives business by $170 billion in the period between April and September.

In a filing to the regulatory authority, the country’s largest broker said that it will provide full cooperation in the matter.

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SAC’s move is part of a large-scale crackdown on the financial services industry that has seen a lot of senior executives literally disappear or face charges. CITIC itself has had to deal with four of its own executives admitting to insider trading earlier this year.

Earlier in the week, SAC also initiated probes into two other large brokerages in the country – Haitong Securities and Guotai Junan Securities, according to state news agency Xinhua.

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