China’s securities regulator announced Friday that Chinese fintech company Ant Group has been fined nearly $1 billion for “illegal acts.”
The China Securities Regulatory Commission announced on Friday that Ant Group and its affiliates have been penalized 7.123 billion yuan (US$984 million) “in view of the illegal and irregular acts by Ant Group and its affiliates in previous years.”
According to the statement, the fine was related to “corporate governance, financial consumer protection, involvement in banking and insurance institution business activities, payment and settlement business, fulfillment of anti-money laundering obligations, and development of fund sales business.”
The largest digital payments platform in the world, Alipay, is run by Ant and has hundreds of millions of users monthly in China and beyond.
But in recent years, the corporation has grown to include lending, investing, and providing insurance to hundreds of millions of individuals and small businesses.
The government has worked to control escalating personal debt and erratic lending in the private sector, and Ant, a rising star, has been generally seen as posing a threat to financial vested interests in the nation’s state-dominated financial system.
The $35 billion Hong Kong-Shanghai IPO that the Alibaba affiliate was planning to issue in 2020 was abruptly scrapped by regulators due to non-compliance with new capital criteria.
It was one of the main targets of an extensive crackdown on the rapidly expanding tech industry in the nation.
After news that Ant would be penalized surfaced on Friday, Alibaba shares in Hong Kong increased by 3.44 percent, according to analysts. Investors viewed Ant’s punishment as proof that the tech crackdown was coming to an end.
