The China Securities Regulatory Commission (CSRC) has confirmed
11 cases of unlicensed securities consulting businesses operating
on the Internet, the securities watchdog said yesterday.
Six of the 11 cases are suspected securities crimes and have
been handed to the public security bureau, CSRC spokesman Liu
Xinhua told China Daily yesterday.
Liu said that Wang Xiujie, known among investors as "Big Brother
Leader 777", will face charges of running an unlicensed and illegal
securities consultancy business.
"Wang's behavior broke the 122nd and 197th items of the
Securities Law, which forbids any institution or person to conduct
securities business without receiving a license from the
regulator," Liu said.
The watchdog said illegal behavior in the securities business is
becoming "very covert" on the Internet.
"These suspects are using websites, blogs and QQ (instant
messaging) to spread tips for stock investors, and charge various
fees in the name of so-called memberships, training, services or
consultancy," Liu said.
Police earlier this month detained Wang, who is suspected of
having earned more than 10 million yuan by selling stock market
advice to thousands of subscribers since February, according to the
Xinhua News Agency.
Wang sold subscriptions for tips sent by instant messaging,
boasting his predictions had a 90 percent accuracy rate, and
labeled himself the "patron saint" of individual investors. His
blog received more than 30 million hits as speculators rushed to
cash in on the bull market.
"Alongside monitoring and striking at illegal securities
businesses, educating stock investors is also very important," Liu
of the CSRC said.
The securities watchdog received 1,638 complaints about various
securities operations in the first half of 2007 and has
investigated 524 of them, Liu said.
Self-styled stock gurus and informal fund managers have thrived
as China's two stock markets more than doubled last year and surged
a further 50 percent this year. The growth has attracted millions
of small investors, many of whom have little awareness of
investment risks.
(China Daily July 27, 2007)
