What’s new: Xu Xiang, a former star fund manager once known as “China’s Carl Icahn,” is due to be released from prison this week after serving a five and half year sentence for manipulating stock prices, handed out in the wake of the country’s 2015 stock market crash.
What’s next for Xu: In June 2017, Xu and his firm Shanghai Zexi Investment Management Co. Ltd. were blacklisted (link in Chinese) by the Asset Management Association of China, an industry group. That means he has since been banned from the fund management industry.
Nevertheless, some of Xu’s associates have prepared for his release registering several private fund companies, beginning in 2016 before his trial even began, sources close to the matter told Caixin.
Along with his incarceration, Xu was also fined 11 billion yuan ($1.7 billion), one of the highest fines levied for a financial offense in China, which has yet to be paid off.
The context: Xu, 44, is one of the highest-profile individuals targeted by China’s securities watchdog over the past few years, as part of the country’s broader crackdown on financial rule-breaking.
Xu and two associates were convicted of stock market manipulation in January 2017. They were accused of colluding with senior executives at 13 listed companies from 2010 to 2015 to issue positive news about companies and purchase stocks in large quantities — all in a bid to boost prices and lure in retail investors. The fund managers and executives then dumped their stock at the higher prices.
Related: In Depth: How a Detained Stock Trader Played with Fire
Contact reporter Luo Meihan (meihanluo@caixin.com) and editor Joshua Dummer (joshuadummer@caixin.com)
Get our weekly free Must-Read newsletter.
