(Yicai Global) Aug. 20 -- The China Securities Regulatory Commission has fined four people between CNY120,000 (USD17,000) and CNY200,000 for instigating and spreading a rumor that the stock market watchdog was "discussing a short-selling mechanism."

Chen Yiheng, who came up with the market-crashing story, must pay a CNY200,000 penalty, the CSRC said online today. Sina Finance Editor Wu Huazhang and two Weibo pundits with a combined 2 million followers -- Wang Xiaru and Lin Wenquan -- each received CNY120,000 fines. The statement did not disclose what Chen does for work.

In January, Chen fabricated a story that cited the CSRC's new Chairman Yi Huiman as saying at a press briefing that his main job in 2019 would be to implement a short-selling mechanism and improve the delisting system, according to the regulator. He claimed the report came from Bloomberg and spread the word via WeChat groups.

Sina, other online media outlets and many accounts on Weibo continued to pass on the message, which resulted in the Shanghai Component Index and Shenzhen Component Index losing 1.3 percent and 1.8 percent in just 30 minutes on Jan. 29.

Editor: James Boynton