China’s securities regulator has opened a probe into Hundsun Technologies, a Chinese financial-services software provider controlled by Alibaba founder Jack Ma, as Beijing cracks down on the previously unregulated grey market in margin finance.
Deng Ge, a spokesman for the China Securities Regulatory Commission, said late Monday that officials from the regulator went to Hundsun’s offices to “check the relevant evidence and supervise the company to strictly abide by the CSRC regulations.”
Earlier in the day, Hangzhou-based Hundsun rejected claims that its popular Homs trading platform helped to amplify China's recent stock market slump. In a Shanghai stock exchange filing, it dismissed the idea aired by some market participants and domestic media that it was somehow to blame.
“Currently, there are rumours in the market saying our Homs system triggered the stock market volatility. This view is very unobjective and unprofessional,” Hundsun said.
The company said the Homs system, launched in 2012, was originally designed for small- and medium-sized asset management companies. However, many grey market margin lenders have flocked to the system to make it the dominant platform for trading with off-market margin finance, according to market participants.
