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China securities regulator to crack down on illegal fundraising via Internet

[SHANGHAI] China's securities regulator said on Friday that it would launch a nationwide crackdown on equity financing via the Internet, and will step up making rules on crowdfunding.

Crowdfunding, which allows start-up firms to raise small sums of capital publicly via the Internet, involves public interest and China's financial stability, so must be regulated by law and is currently banned in China, the China Securities Regulatory Commission (CSRC) said on its official microblog.

Institutions in China, though, are allowed to raise capital via the Internet from no more than 200 select investors, and CSRC, in its special investigation, will make sure rules are not violated, according to the regulator.