China Suspends Popular Trading Platform From Adding New Clients

Bloomberg

2024-11-15

(Bloomberg) -- China’s market watchdog ordered Hithink RoyalFlush Information Network Co. to suspend its investment advisory service unit from adding new clients for three months as its live streaming business failed to comply with the securities rules.

The Hangzhou-based financial data and software company, which also enables stock trading in China, was being penalized partly because some influencers on its platform were offering investment advice without the required licenses, the company said in an exchange filing citing the disciplinary note from the China Securities Regulatory Commission. Those influencers also gave implicit recommendation of individual stocks during live streaming.

The regulator also criticized the company’s insufficient compliance control when collaborating with securities companies to provide investment consulting services.

Hithink RoyalFlush pledged to “reflect deeply and make timely corrections” in order to resume taking new customers as soon as possible. It added that the investment advisory service only accounted for 199 million yuan ($28 million), or 5.6%, of its consolidated operating income in its 2023 financial year. It does not expect the CSRC’s disciplinary action to impact its 2024 earnings.

Shares of the company tanked 14.3% on the Shenzhen exchange Friday, the most in more than a month.

Chinese regulators have been clamping down on influencers and livestreaming platforms for offering investment advice to retail investors without holding the appropriate licenses, local media China Securities Journal reported earlier this week.

This isn’t the first time Hithink RoyalFlush has been under scrutiny. CSRC investigated the firm for potential violations of securities and futures law in 2015. The company, which was founded in 2001, has more than 5,000 staff in China. Its clients include brokers, mutual and private funds, banks, insurance companies and retail investors. The firm’s net income fell 7.5% year on year to 288 million yuan on revenue of 945 million yuan in the third quarter.

--With assistance from Mengchen Lu, Qingqi She and Foster Wong.

©2024 Bloomberg L.P.

免責聲明：投資有風險，本文並非投資建議，以上內容不應被視為任何金融產品的購買或出售要約、建議或邀請，作者或其他用戶的任何相關討論、評論或帖子也不應被視為此類內容。本文僅供一般參考，不考慮您的個人投資目標、財務狀況或需求。TTM對信息的準確性和完整性不承擔任何責任或保證，投資者應自行研究並在投資前尋求專業建議。

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Those influencers also gave implicit recommendation of individual stocks during live streaming.</p><p>The regulator also criticized the company’s insufficient compliance control when collaborating with securities companies to provide investment consulting services. </p><p>Hithink RoyalFlush pledged to “reflect deeply and make timely corrections” in order to resume taking new customers as soon as possible. It added that the investment advisory service only accounted for 199 million yuan ($28 million), or 5.6%, of its consolidated operating income in its 2023 financial year. It does not expect the CSRC’s disciplinary action to impact its 2024 earnings.</p><p>Shares of the company tanked 14.3% on the Shenzhen exchange Friday, the most in more than a month. </p><p>Chinese regulators have been clamping down on influencers and livestreaming platforms for offering investment advice to retail investors without holding the appropriate licenses, local media China Securities Journal reported earlier this week. </p><p>This isn’t the first time Hithink RoyalFlush has been under scrutiny. CSRC investigated the firm for potential violations of securities and futures law in 2015. The company, which was founded in 2001, has more than 5,000 staff in China. Its clients include brokers, mutual and private funds, banks, insurance companies and retail investors. 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Those influencers also gave implicit recommendation of individual stocks during live streaming.</p><p>The regulator also criticized the company’s insufficient compliance control when collaborating with securities companies to provide investment consulting services. </p><p>Hithink RoyalFlush pledged to “reflect deeply and make timely corrections” in order to resume taking new customers as soon as possible. It added that the investment advisory service only accounted for 199 million yuan ($28 million), or 5.6%, of its consolidated operating income in its 2023 financial year. It does not expect the CSRC’s disciplinary action to impact its 2024 earnings.</p><p>Shares of the company tanked 14.3% on the Shenzhen exchange Friday, the most in more than a month. </p><p>Chinese regulators have been clamping down on influencers and livestreaming platforms for offering investment advice to retail investors without holding the appropriate licenses, local media China Securities Journal reported earlier this week. </p><p>This isn’t the first time Hithink RoyalFlush has been under scrutiny. CSRC investigated the firm for potential violations of securities and futures law in 2015. The company, which was founded in 2001, has more than 5,000 staff in China. Its clients include brokers, mutual and private funds, banks, insurance companies and retail investors. The firm’s net income fell 7.5% year on year to 288 million yuan on revenue of 945 million yuan in the third quarter.</p><p>--With assistance from Mengchen Lu, Qingqi She and Foster Wong.</p><p>©2024 Bloomberg L.P.</p></article></body></html>\n<div class=\"bt-text\">\n\n\n<p> 來源：<a href=\"https://www.bnnbloomberg.ca/business/international/2024/11/15/china-suspends-popular-trading-platform-from-adding-new-clients/\">Bloomberg</a></p>\n<p>為提升您的閱讀體驗，我們對本頁面進行了排版優化</p>\n\n\n</div>\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4211","symbol_name":"區域性銀行","start_time":0,"source_url":"https://www.bnnbloomberg.ca/business/international/2024/11/15/china-suspends-popular-trading-platform-from-adding-new-clients/","article_id":"2483309620","we_media_id":null,"thumbnails":["https://static.themebuilder.aws.arc.pub/bellmediainc/1717607291216.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2483309620","pubTimestamp":1731684872,"columns":[],"sourceInfo":{"source_id":"bnn_bloomberg_highlight","name":"Bloomberg"},"weMediaInfo":null,"summary":"China’s market watchdog ordered Hithink RoyalFlush Information Network Co. to suspend its investment advisory service unit from adding new clients for three months as its live streaming business failed to comply with the securities rules.","collect":0,"end_time":0,"defaultTopTitle":"bnnbloomberg.ca","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4211":"区域性银行","BPOP":"大众银行"},"translate_title":"中国暂停热门交易平台增加新客户","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"BPOP":1},"content_text":"(Bloomberg) -- China’s market watchdog ordered Hithink RoyalFlush Information Network Co. to suspend its investment advisory service unit from adding new clients for three months as its live streaming business failed to comply with the securities rules.   The Hangzhou-based financial data and software company, which also enables stock trading in China, was being penalized partly because some influencers on its platform were offering investment advice without the required licenses, the company said in an exchange filing citing the disciplinary note from the China Securities Regulatory Commission. Those influencers also gave implicit recommendation of individual stocks during live streaming.The regulator also criticized the company’s insufficient compliance control when collaborating with securities companies to provide investment consulting services. Hithink RoyalFlush pledged to “reflect deeply and make timely corrections” in order to resume taking new customers as soon as possible. It added that the investment advisory service only accounted for 199 million yuan ($28 million), or 5.6%, of its consolidated operating income in its 2023 financial year. It does not expect the CSRC’s disciplinary action to impact its 2024 earnings.Shares of the company tanked 14.3% on the Shenzhen exchange Friday, the most in more than a month. Chinese regulators have been clamping down on influencers and livestreaming platforms for offering investment advice to retail investors without holding the appropriate licenses, local media China Securities Journal reported earlier this week. This isn’t the first time Hithink RoyalFlush has been under scrutiny. CSRC investigated the firm for potential violations of securities and futures law in 2015. The company, which was founded in 2001, has more than 5,000 staff in China. Its clients include brokers, mutual and private funds, banks, insurance companies and retail investors. 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