China’s gray market financing sector is under pressure as the China Securities Regulatory Commission investigates Hundsun (600570.SHA), a financial information firm controlled by Alibaba (BABA.NYSE) founder Jack Ma that links small institutions like hedge funds and online peer-to-peer lending operators with brokerages through its cloud-based HOMS platform, South China Morning Post reported. During the stock market’s recent boom, institutions using HOMS and similar systems offered margin loans worth more than 2 trillion yuan to individual investors, according to the CSRC, with HOMS accounting for at least RMB500 billion. Hundsun said in a filing to the Shanghai exchange on Tuesday it was not fair to blame it for the market’s recent turmoil.
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