From: ft.com
By Reuters

JPMorgan’s China asset management joint venture said on Wednesday it had fired senior fund manager Tang Jian due to an official probe into stock trades, as Beijing cracks down on growing irregularities in the market.

”We have just been informed by regulatory authorities that they have started a formal investigation of our employee Tang Jian over investment irregularities,” Shanghai-based China International Fund Management Co. said in a statement.

”Through our cooperation with regulators in the probe, we found Tang Jian is suspected of using insider information to engage in illicit investment activities,” the statement said, quoting China International Chief Executive Mandy Wang.

”We also found that he did not report to the company about his family’s investment activities, which seriously violated our company’s rules,” Wang was quoted as saying in the statement, released after the stock market closed on Wednesday.

Under Chinese regulations, fund managers are barred from dealing shares on their own.

Tang, a well-known Chinese fund manager who joined the company in 2004, could not be reached for comment.

Tang is the first Chinese fund manager to be sacked over suspicion of illicit stock trades.

Analysts said the investigation would deal a blow to the image of China’s nascent mutual fund industry, which has grown rapidly over the past year to around 1 trillion yuan ($130bn) on a booming stock market.

It is also a sign that Beijing is stepping up its efforts against irregularities in the stock market, which has set a string of record highs this year as investors divert large amounts of bank savings into stocks.

The China Securities Regulatory Commission (CSRC), the country’s top securities watchdog, said on Saturday it would intensify efforts to clamp down on growing insider trading and stock price manipulation.

”It is worth noting that market irregularities have increased as a large number of investors lacking an awareness of the risks associated with stock trading are entering the market,” the CSRC said.

China’s main stock index climbed 2.23 per cent on Wednesday, regaining its footing after a 3.64 per cent tumble the day before.

Copyright Fund China 2008.

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