Star Stock Trader Set to Face Trial for Insider Trading
(Beijing) — The trial of a well-known Chinese private-fund manager who is charged with stock market manipulation is set to start Monday, according to a notice from the Qingdao Intermediate People's Court on Thursday.
Xu Xiang, the 40-year-old founder and general manager of the Shanghai-based asset management firm Zexi Investment, was detained in November 2015 and indicted on Nov. 10 by prosecutors in Qingdao, Shandong province, on charges that he manipulated the securities market, according to the official Xinhua News Agency.
Sources told Caixin that it is the first criminal case in China related to insider trading and share price manipulation, and the court’s decision could be a significant milestone.
Xu and two other investment firm managers are suspected of conspiring with 23 senior executives of 13 listed companies beginning in 2011 to make illicit profits. Together they are suspected to have spread positive news about companies as the private-fund management firm boosted the share prices through large-volume purchases in a bid to lure retail investors follow suit. The executives then sold their stock and split the profits with the fund managers.
Sources told Caixin that more than 40 billion yuan ($5.8 billion) was involved in the alleged insider trading, and profits ran into billions of yuan. The executives of the listed companies concerned have all resigned, and are also under investigation.
Contact reporter Dong Tongjian (email@example.com); editor Calum Gordon (firstname.lastname@example.org).
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