China is hitting the brakes on private placements of stock in the wake of signs that the equity financing method has been abused by many public companies, favoring selected investors with lower prices and hiding information from others. The amount of funds raised by listed firms from private placements in November has fallen to less than 40% of all equity investments, down from an average of 92% for the previous 10 months, according to data provider Wind Information. The other two main types of equity investment covered by Wind are initial public offerings and rights issues. The latter happens when a company gives its shareholders the right to buy additional securities in proportion to their existing holdings. According to Caixin, the China Securities Regulatory Commission (CSRC) recently has slowed the pace of approving new private placements while permitting more IPOs.