Ant Group, (BABA) the fintech company established by billionaire Jack Ma, was penalized $994 million by China’s top financial regulators for violating laws pertaining to corporate governance and consumer protection.
In addition, Ant Group has violated laws governing “business activities in banking and insurance, payments, anti-money laundering, and funds sales,” according to a joint statement from the China Securities Regulatory Commission, the People’s Bank of China, and the National Financial Regulatory Administration.
Following more than two years of investigations into the finance technology company established by billionaire Jack Ma a former English teacher, cofounded Alibaba Group, the People’s Bank of China reported that financial regulators penalized Ant 7.12 billion yuan ($984 million). A 2.99-billion-yuan fine was imposed against Tencent, according to statements made by the central bank on Friday.
In New York trade, shares of Alibaba Group Holding Ltd., a subsidiary of Ant, increased by more than 6%. Investors are anticipating that the fines put an end to the multi-year investigation that derailed Ant’s anticipated IPO in 2020 and caught some of the most influential private companies in the country in industries including gambling and online education. It opens up opportunities for Ant to resume growth and perhaps resuscitate IPO prospects.
Ant Group said in a statement, “We will comply with the terms of the penalty in all earnestness and sincerity and continue to further enhance our compliance governance.”
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