China's Ant Group fined $1b as part of tech sector crackdown
The China Securities Regulatory Commission (CSRC) claims that "at present, most of the outstanding problems in the financial business of platform enterprises have been rectified".
China's financial regulators said Friday that fintech giant Ant Group which operates Alipay, the world's largest digital payments platform, has been fined almost $1 billion for "illegal acts".
Ant Group is among the prominent targets of a crackdown on irregularities in the tech sector.
The same day, China fined payment platform Tenpay affiliated with tech titan Tencent almost three billion yuan ($415 million) and confiscated 556 million yuan in illegal income, a filing from the People's Bank of China demonstrated.
The China Securities Regulatory Commission (CSRC) said in a statement: "In view of the illegal and irregular acts by Ant Group and its affiliates in previous years... (the companies) have been fined 7.123 billion yuan (US $984 million)", adding that the penalty "included the confiscation of illegal income".
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The CSRC claims that "at present, most of the outstanding problems in the financial business of platform enterprises have been rectified".
"The work focus of the financial management department has shifted from promoting the centralized rectification of the financial business of platform companies to normalized supervision," it continued.
Runaway debts and chaotic lending
Alibaba shares on Friday were up 3.44% in Hong Kong with analysts claiming that investors saw the consequence as a sign the crackdown was ending.
Ant released a statement that it would "comply with the terms of the penalty in all earnestness and sincerity and continue to further enhance our compliance governance".
"Now the company has completed the related work on the rectification... In the future, Ant Group will uphold its mission and original aspiration," it said, adding: "We will continue to pursue innovation with a firm commitment to integrity, and continue to enhance our R&D capabilities to better serve and create greater value for the physical economy, especially for consumers and small businesses".
The CRSC described the fine as being related to "corporate governance, financial consumer protection, participation in business activities of banking and insurance institutions, payment and settlement business, fulfillment of anti-money laundering obligations, and development of fund sales business".
The Chinese government has been trying to control runaway personal debt and chaotic lending in the private sector.