CSRC Widens Everbright Glitch Probe

Everbright, a state-controlled business, is one of China's largest securities brokerages. Its glitch led to the replacement of the company's president, Xu Haoming, and the CSRC was initially investigating whether Mercrtsoft, the supplier of its system, was at fault for the technical failure of the system.
"On August 16, the arbitrage system with such design defects as program call errors and quota control failure was triggered successively, resulting in massive amount [sic] of market purchase orders being directly submitted to the SSE with total declared purchase of RMB 23.4 billion and actual transaction of RMB 7.27 billion," says a CSRC spokesperson, in a statement. "On the same day, Everbright Securities sold RMB 1.85 billion worth of shares via ETF and sold short 7130 lots of stock index futures contracts."
The expansion of the investigation comes after CSRC's Shanghai bureau recommended a series of remedial measures at the brokerage, which also suffered another recent trading loss in the bond markets due to human error.
"As the first ever case of its kind in China ever since the establishment of China's capital market, this incident is an extreme exception," the CSRC adds. "However, the problems it revealed should alert all participants in the securities and futures industry."
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@waterstechnology.com or view our subscription options here: https://subscriptions.waterstechnology.com/subscribe
You are currently unable to print this content. Please contact info@waterstechnology.com to find out more.
You are currently unable to copy this content. Please contact info@waterstechnology.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@waterstechnology.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@waterstechnology.com
More on Regulation
Citi gears up for EU T+1 climb
The bank has a dedicated team examining what it needs to do to ensure a successful transition to T+1 in Europe.
The great disappearing internet—and what it could mean for your LLM
AI-generated content, bots, disinfo, ads, and censorship are killing the internet. As more of life continues to happen online, we might consider whether we’re building castles atop a rotting foundation.
AI’s next gig: The rising cost of off-channel communications compliance
As the cost of analyzing communications increases, what tools can firms deploy to save time and money while avoiding penalties?
CAT on life support after appeals court ruling
Ahead of a comprehensive review promised by the SEC, lawyers believe that the recent overturn of the Consolidated Audit Trail’s funding order could herald its demise.
Euroclear readies upgrade to settlement efficiency platform
Euroclear, Taskize, and Meritsoft are working together to deliver real-time insights and resolution capabilities to users settling with any of Euroclear’s CSDs.
Messaging’s chameleon: The changing faces and use cases of ISO 20022
The standard is being enhanced beyond its core payments messaging function to be adopted for new business needs.
TT partners Thoma Bravo, Fitch launches GenAI solution, AI infrastructure woes, and more
The Waters Cooler: EquiLend acquires Trading Apps, Ultumus and BMLL partner for ETF data and analytics, and more in this week’s roundup.
CAT funding plan struck down by US appeals court
The 11th Circuit court ruled that the SEC had not established a sufficient precedent to pass the costs of the Consolidated Audit Trail on to broker-dealers.