China launches first class-action lawsuit in war against corporate fraud

The mechanism was introduced last year to bolster investor confidence

China launched the country’s first class-action lawsuit against a listed company on Friday, targeting Kangmei Pharmaceutical Co, as regulators vowed “zero tolerance” against accounting fraud and other capital markets “tumors”.
 
The China Securities Investor Service Centre (CSISC), a government-affiliated body, is suing Kangmei on behalf of more than 50 individual investors in a landmark case in China’s capital markets, the China Securities Regulatory Commission (CSRC) said.
 
Kangmei was engaged in intentional and systematic financial cheating worth 30 billion yuan ($4.60 billion) between 2016 and 2018, CSRC said, adding “toxic tumors” in capital markets must be eradicated swiftly, and