JPMorgan has fired senior portfolio manager Tang Jian from its joint venture in China due to an investigation by officials into his stock trades, Reuters repots. Chinese regulations bar fund managers from buying securities on their own. The investigation comes at a time when the regulators in China are cracking down on the market.
On Saturday, the China Securities Regulatory Commission said it would increase its oversight of insider trading and stock price manipulation, and sources told Reuters that the Commission issued a warning to fund houses earlier this week.
“We have just been informed by regulatory authorities that they have started a formal investigation of our employee Tang Jian over investment irregularities,” China International Fund Management 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.”
Tang, a well-known fund manager, is the first fund manager in China to lose his job over suspicion of illicit trades. Insider watchers believe the investigation could dampen investors’ enthusiasm for mutual funds. In 2000, China’s fund industry was investigated after it was discovered that fund managers were meeting in saunas to exchange market information without fear of wiretaps.