Citic Short-Selling Offer to Funds Led Police to Its Door
- Investigation First Focused on Shorting Method for Foreigners
- "Looks from the outside like an unfair and arbitrary search"
A pedestrian walks past a Citic Securities Co. branch in Shanghai, China, on Wednesday, Sept. 16, 2015. The president of China's biggest brokerage has been swept up in a widening campaign to root out financial wrongdoing and assign blame for the nation's $5 trillion stock rout.
Photographer: Qilai Shen/BloombergThe fall from grace for China’s biggest brokerage and investment bank, Citic Securities Co., has been fast and steep. The firm -- sometimes referred to as the Goldman Sachs of China -- began the year on its way to eclipsing UBS Group AG in the ranks of the top four securities firms in the world.
Now it’s embroiled in a police investigation and a probe by the stock-market regulator. Its chairman is being replaced and its top leadership reorganized. At least nine Citic executives have been investigated for alleged insider trading or haven’t shown up to work and can’t be reached.