(Yicai) Feb. 29 -- The China Financial Futures Exchange has banned Shanghai Weiwan Fund Management from opening stock index futures positions for 12 months.

Weiwan will also have CNY8.9 million (USD1.2 million) of illegal gains confiscated, the bourse announced late yesterday, after finding the hedge fund manager in breach of its rules. 

Weiwan failed to tell the CFFEX that the Shanghai-based firm was the actual controller of three accounts it managed, and Weiwan’s actual controller Zhang Wang and his relatives failed to reveal that they controlled two other personal trading accounts, the exchange said.

During the period Weiwan and Zhang did not disclose the information, their illicit accounts traded stock index futures and other financial products, thereby accruing the illegal gains, the CFFEX noted, citing the results of an investigation.

Founded in 2016, Weiwan has a registered capital of CNY10 million (USD1.4 million), according to the Asset Management Association of China.

The CFFEX recently stepped up its monitoring of trading activities and efforts to deal with abnormalities in the market. The China Securities Regulatory Commission also said it will continue to adhere to a strict regulatory tone and guide exchanges and the CFFEX to strengthen the coordination of supervision between the futures and spot markets in a crackdown on illegal behavior.

On Feb. 20, the Shanghai and Shenzhen stock exchanges separately announced the introduction of trading limits on Ningbo Lingjun Investment Management Partnership for high-frequency irregular trading behavior.

Editor: Futura Costaglione