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the securities industry's version of the personal credit reporting system has been in effect for two years and its power is evident.

recently, china cinda securities hired three senior executives at one time, including wei xianfeng, the former chairman of jiuzhou securities, as the company's deputy general manager.

however, the personal public information of the china securities association (hereinafter referred to as "china securities association") shows that wei xianfeng has a record of "illegal and dishonest". for a time, cinda securities also caused controversy due to the appointment of personnel with a history of "illegal and dishonest". coincidentally, a reporter from securities china also received a report email recently saying that jinyuan securities hired a senior executive with a record of "illegal and dishonest" information.

a reporter from securities china found out that in addition to the above-mentioned senior executives, the public information of many securities firms' business line personnel, especially in the investment banking field, has added "illegal and dishonest" information. this is actually related to the "securities industry professional reputation information management measures" officially implemented by the china securities association on september 1, 2022. positive and negative information of securities practitioners, including regulatory warning letters, interviews and other penalty information, are collected, recorded and disclosed, thereby warning practitioners to strengthen self-discipline and cherish and maintain their professional reputation.

however, some industry insiders believe that directly disclosing information showing "illegal and dishonest behavior" may not be rigorous enough in wording, which can easily lead outsiders to mistakenly believe that it is illegal and dishonest behavior, "deadbeat" behavior, etc. in the judicial field. they suggest that it be revised to more precise terms such as "negative reputation".

in-service executives add "illegal and dishonest" information

on august 28, china cinda securities announced that the company's board of directors appointed wei xianfeng and three others as company executives. wei xianfeng was promoted from his previous position as the company's business director to deputy general manager.

according to his resume, wei xianfeng has worked at wuhan foreign languages ​​school, yuehua accounting firm, sino-swiss yuehua accounting firm, kunwu jiuding investment management co., ltd., and jiuzhou securities, and was once the business director of cinda securities.

however, the practitioner information of the china securities association showed that wei xianfeng had one "illegal and dishonest" information, which triggered controversy over whether cinda securities hired "illegal and dishonest" executives.

china securities journal reporters learned that before joining cinda securities, wei xianfeng served as the chairman of jiuzhou securities (now huayuan securities). in october 2021, wei xianfeng, as the chairman of jiuzhou securities, was subject to regulatory talks by the qinghai securities regulatory bureau. the reason was that wei xianfeng, as the chairman of jiuzhou securities, signed a related "betting" agreement without reporting it and had a weak sense of compliance.

coincidentally, on august 26, a reporter from securities china received a related reporting email, reporting that jinyuan securities hired "illegal and untrustworthy" person tian yuan as a senior executive.

according to a reporter from securities china, tian yuan’s “illegal and dishonest” information was also related to the administrative measures of regulatory talks that had been taken against him previously.

public information shows that tian yuan, deputy general manager of jinyuan securities, once served as deputy general manager of wugang securities. in june last year, the shenzhen securities regulatory bureau issued an announcement on the decision to take regulatory talks with tian yuan. the announcement disclosed that after investigation, the private asset management business of wugang securities had the following problems: first, there were problems with bond investment decisions and risk control. second, the investment management of non-standard assets was not standardized. third, the rectification of the new asset management regulations was not in place, and new non-compliant products were added during the transition period. fourth, the management mechanism for related transactions was not perfect. as the head of the asset management business department of wugang securities at the time, tian yuan was responsible for the management of the above-mentioned violations, and the shenzhen securities regulatory bureau decided to take administrative supervision measures against him through regulatory talks.

a reporter from securities china checked the information on the official website of the china securities association and found that many current executives of leading securities firms are also burdened with information of "illegal and dishonest" behavior.

for example, a senior executive of a leading securities firm in beijing was responsible for the stock pledge business due to imprudent behavior, and was issued a warning letter by the beijing securities regulatory bureau in april this year, adding an "illegal and dishonest" information to it. several senior executives of a leading securities firm in shanghai were also recorded as "illegal and dishonest" due to regulatory talks.

there are many cases of "illegal and dishonest behavior" in investment banking and research fields

in fact, the areas with the most newly added "illegal and dishonest behavior" in the information of practitioners disclosed by the china securities association may be investment banking and research.

in recent years, investment banking business has been one of the main battlefields of strict supervision. in order to strengthen the supervision of investment banking business and strictly enforce the responsibilities of sponsors, investment banking fines have emerged in an endless stream and many investment bank underwriters have been fined.

china securities journal reporters noticed that among the sponsors announced by many leading investment banks, the number of people with "illegal and dishonest" records reached double digits. for example, as of the data of the china securities association on august 29, haitong securities had a total of 443 sponsors, 21 of whom had "illegal and dishonest" records, and 7 of them had 2 illegal and dishonest records. among the 626 sponsors of citic securities, 17 had "illegal and dishonest" records, and 2 of them had 2 illegal and dishonest records. among the 607 sponsors of citic construction investment, 19 had "illegal and dishonest" records, and 1 of them had 2 illegal and dishonest records.

at the same time, in the research field, many analysts who have been fined by regulatory authorities for research report compliance issues and research institute compliance issues have added a record.

for example, liu zhangming, who was recently demoted to deputy director of founder securities research institute, has a record of "illegal and dishonest" because he was punished for compliance issues in founder securities' research report business at the beginning of the year.

in january this year, the hunan securities regulatory bureau took corrective measures against founder securities, and liu zhangming, the director of founder securities research institute who took office in may 2023, was issued a warning letter. the hunan securities regulatory bureau said that after investigation, founder securities leaked the content and views of securities research reports before issuing securities research reports in the process of issuing securities research reports. as the administrative head of the company's securities research report business department, liu zhangming bears leadership responsibility for the above situation.

for another example, huang yanming, the former director of the guotai junan research institute, also had a record of "illegal and dishonest behavior". in june 2023, the shanghai securities regulatory bureau issued a warning letter to guotai junan. the shanghai securities regulatory bureau stated that after investigation, it was found that guotai junan's institutional regulations on quality control and compliance review of securities research report business were imperfect, and that it had not established an effective market impact assessment mechanism for securities research reports, and had not conducted a prudent assessment of the impact that sensitive information related to a securities research report might have on the market. as the director of the research institute at the time, huang yanming was responsible for the management of the problems existing in the institute, so he was also issued a warning letter.

the power of personal credit records in the securities industry is evident

what seems to be serious "illegal and dishonest" information to the outside world is actually mainly regulatory penalty information directly linked to personal resumes. this is mainly related to the securities industry's efforts in personal credit reporting in 2022.

on september 1, 2022, the "securities industry professional reputation information management measures" was officially implemented, which is known as the securities industry version of personal credit reporting. china securities association has also updated the public information column of practitioners. on the basis of the original public information, new columns such as "commendation and rewards", "illegal and dishonest", "other positive information" and "other negative information" have been added.

"this professional reputation basically includes all the major rewards and punishments, positive and negative information during the practitioner's career. it is a personal professional file, which will play a certain restraining role on the individual's practice. practitioners should cherish their professional reputation." a person from a leading securities firm told reporters.

it is understood that the "opinions on further strengthening the self-discipline management responsibilities of the china securities association" proposed that the association should "build a market-oriented self-discipline constraint, moral constraint, integrity constraint, and reputation constraint mechanism". in order to implement the "opinions", further establish and improve the reputation management mechanism for the securities industry, strengthen the self-discipline and reputation constraints of industry players, give full play to the role of market-oriented constraint mechanisms, and serve the registration system reform, the association organized the drafting of the "management measures".

specifically, an individual's basic information includes name, gender, nationality, id type, id number, as well as the organization, department, position, registration category and number (if any), etc.

credit information includes commendation and reward information and illegal and dishonest information. commendation and reward information includes the name of the commendation and reward, the issuing unit, the issuing time, the commendation and reward category, etc.

the illegal and dishonest information includes the name of the illegal and dishonest case, the unit making it, the time of making it, the type of illegal and dishonest case, etc. for example: administrative penalties, market ban decisions and supervisory and management measures made by the china securities regulatory commission and its dispatched agencies; disciplinary measures implemented by the securities and futures market industry organizations and management measures stipulated by laws, administrative regulations and rules; refusal to perform the securities and futures dispute mediation agreement reached; being sentenced by the people's court for securities and futures crimes or other crimes; interfering with the supervision and law enforcement work of the china securities regulatory commission and its dispatched agencies by improper means, being given administrative penalties, disciplinary sanctions, or not being punished due to minor circumstances, but being identified by disciplinary inspection or administrative supervision agencies; self-regulatory management measures made by the association; other situations identified by the association.

therefore, the increased "illegal and dishonest" information of the above-mentioned senior executives, investment banks, research and other fields is mainly synchronized with the administrative penalties and regulatory measures taken by the csrc or local securities regulatory bureaus. this means that under the strict supervision situation, every securities firm in the industry may have employees who are burdened with "illegal and dishonest" information to a greater or lesser extent.