In the largest financial penalty issued by China’s securities regulator, railway operating firm Beibadao Group was fined RMB 5.67 billion ($870 million) yesterday for manipulating share prices, Caixin Global reports.
China Securities Regulatory Commission said that Beibadao has established a team of traders to use borrowed money to pump-up the prices of newly-listed companies and so falsely advertising the quality of the stock to potential investors.
Beibadao made RMB 945 million of profits from February to May in 2017 via this illegal pump-and-dump scheme, the Commission found.
The head of the company, Lin Qingfeng, has refused to cooperate with the regulators, with reports of Beibadao staff attempting to destroy evidence and engaging in physical fights.