China warns brokerages not to spread sensitive information

CHINA is warning domestic brokerages not to spread information that compromises national security, reinforcing a campaign that has roiled consulting firms and providers of financial data.

Analysts have to prevent leaks and the spread of false information that can have a big influence on the market, regulators said in a message to the industry after the inspections of 45 brokerages.

Staff also need to confirm the legality and accuracy of anything obtained by talking to experts or through research, according to the notice, which called on speeches by analysts to be “managed.” The notice is part of a monthly oversight process. Previous messages to brokers in recent months have voiced similar concerns over safeguarding information and interacting with experts.

Beijing has launched a crackdown on perceived threats to national security as tensions grow between the West and China. Authorities have raided foreign consulting firms and limited foreign access to financial data.

The most prominent target has been Capvision Pro Corp, a global expert network headquartered in Shanghai and New York. Chinese authorities on Tuesday accused the firm of leaking state secrets and being linked to foreign intelligence agencies. One state broadcaster aired footage of security officials seemingly raiding the firm’s offices, questioning employees and seizing more than 20 computers.

Authorities have also questioned staff at the China offices of US consultant Bain & Co and targeted New York-based due-diligence enterprise Mintz Group as part of the crackdown, according to state media. BLOOMBERG