Chinese regulators have banned Hui Ka Yan, the founder of property giant China Evergrande Group from the securities market over fraudulent activities, inflation of data and failure to make timely disclosures.
Hui, who is also the chairperson of the company, was fined $6.53 million over financial fraud. Evergrande was fined $580 million.
The China Securities Regulatory Commission (CSRC) made the decision after Hui allegedly directed his staff to "falsely inflate" Evergrande's mainland business Hengda Real Estate's annual results in 2019 and 2020. The corporates bonds issued by Evergrande in 2020 and 2021 are also suspected to be involved in fraudulent acitivities.
The hefty fine comes amid Beijing's efforts to regulate the capital market to ensure stability in the country's economic sector. Evergrande's debt has resulted in a real estate crisis in China, lasting several years.
Following this in January, a Hong Kong court had issued an order to liquidate Evergrande. Liquidators are looking into restructuring strategies, including selling the company's assets in order to pay the debts.
