Zhejiang Chouzhou Commercial Bank Ordered to Rectify: Some Fund Sales Staff Lack Qualifications

Deep News12-01

On December 1, financial authorities issued a rectification order against Zhejiang Chouzhou Commercial Bank following an inspection by the Zhejiang Securities Regulatory Bureau. The investigation revealed multiple violations:

1. **Unqualified Sales Personnel**: Some employees engaged in fund sales lacked required qualifications, violating Article 30(2) of the "Publicly Offered Securities Investment Fund Sales Institutions Supervision Measures" (CSRC Order No. 175) and Article 17(1) of its implementing rules (CSRC Announcement [2020] No. 58).

2. **Compliance Failures**: Certain fund promotional materials and revised sales policies bypassed compliance reviews, while dedicated compliance officers simultaneously handled business management duties. This breached Articles 16(2), 26(1), and 26(2) of the same regulation.

3. **Investor Protection Shortcomings**: The bank processed fund sales for clients without risk assessments, failed to prompt app users to review fund contracts/prospectuses, and neglected special due diligence when selling high-risk products to retail investors. These actions contravened Articles 17(1)-(2) of the fund sales rules and Articles 3, 10(2), and 20 of the "Securities and Futures Investor Suitability Measures" (CSRC Order No. 202).

4. **Anti-Money Laundering Lapses**: The institution did not submit required AML documentation as mandated by Article 10 of the "Securities and Futures Industry AML Implementation Rules" (CSRC Order No. 202).

The regulator ordered corrective actions under relevant provisions of the cited regulations, recording the violations in the securities market integrity archive. The bank must implement thorough rectification, strengthen fund sales management, and submit a written improvement report within 30 days, subject to potential follow-up inspections.

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