(Yicai) July 3 -- A media report that said China’s securities regulator has launched an investigation into the stock trading accounts of brokerage staff and their relatives going back three years is false, according to an informed source.

“The claim of a comprehensive review covering three years is a rumor,” the person familiar with the matter told Yicai. But securities firms have beefed up the internal supervision of relevant accounts, with regular and ad-hoc annual checks, the source added.

Media outlet Jiemian reported yesterday that the China Securities Regulatory Commission is probing the trading account activity of securities professionals and their relatives over the past three years. According to the law, they are not allowed to buy and sell stocks.

It is normal for brokerages to conduct internal checks on employees and their family members, according to industry insiders, who added that these inspections are now more frequent and much stricter than before.

A source at a leading brokerage told Yicai that an employee was recently found to have engaged in illegal trading because their activity matched the IP address of a relative’s trading account. Another source at a small securities firm said a staffer recently resigned in the wake of checks on their trading account.

Since the start of the year, the CSRC has been has putting together a plan to crack down on illegal stock speculation by brokerage personnel. In February, the watchdog announced it had uncovered insider trading and slapped administrative penalties on more than 60 individuals.

Between 2019 and last year, the CSRC investigated and dealt with illegal stock trading by 67 securities professionals and punished 139 individuals.

Editor: Futura Costaglione