CSRC Cautions China Securities for Forcing College Students to Open Stock Accounts
Dou Shicong
/SOURCE : Yicai
CSRC Cautions China Securities for Forcing College Students to Open Stock Accounts

(Yicai Global) Dec. 6 -- The China Securities Regulatory Commission (CSRC), the country's top securities regulator, has issued a warning to the Nanjing branch of CSC Financial Co. [HKG:6066] (China Securities) after the brokerage pushed local university students into opening stock trading accounts.

China Securities illegally opened stock and share accounts for freshmen at the Nanjing University of Science and Technology, based in Jiangsu province, in September this year, financial news outlet Securities Times reported yesterday. While the students were at the bank to activate new cards, bank staff tricked them into opening stock accounts, advising the process was compulsory.

However, the CSRC issued new regulations on investor suitability in July this year, giving explicit classifications for investors and products and ensuring they are appropriately matched. The guidelines prevent students from opening speculative investment accounts.

The branch violated the new rules, the CSRC said in a statement on Dec. 4. The regulator required China Securities to compile a remedial report within 30 days, explaining how it has rectified the problem. China Securities' warning letter is the first the regulator has issued since bringing in the new policy.

The brokerage carried out an internal investigation and punished the branch after it received complaints from the students' parents, it said, adding that it had already stopped opening such accounts for students across the company.

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Keywords: China Securities , Nanjing University of Science And Technology , China Securities Regulatory Commission , Stock Markets , Students , REGULATION