New Focus in Fund Annual Report Disclosure! Details of penalties for 29 institutions revealed, some suspended from new issuance

Ask AI · How new regulatory rules are driving more transparent fund annual report disclosures?

Jiemian News reporter | Han Li

As 2025 fund annual reports are gradually released, details of regulatory penalties imposed on fund companies in that year are coming to light.

According to an incomplete tally by Jiemian News reporter, throughout 2025, at least 29 public funds received administrative regulatory measures issued by regulatory authorities—such as warning letters, orders to rectify, and the like. Some public fund firms also faced penalties including suspension of product registrations or business applications.

Jiemian News noted that, compared with prior annual reports, the 2025 annual reports disclosed investigation or penalty information in much greater detail. As to the reasons for additional newly listed items, multiple insiders from the public fund industry told Jiemian News reporter that this stems from regulatory requirements.

Source: Compiled by Jiemian News based on fund annual reports

Jiemian News reporter reviewed the “Guidelines No. 2 on Contents and Forms of Information Disclosure for Publicly Offered Securities Investment Funds—Contents and Forms of Periodic Reports” released by the CSRC. Article 33 shows that annual reports and interim reports must briefly disclose the following major events occurring during the reporting period, including cases where the fund manager, custodian, and relevant practitioners are investigated or face penalties. In addition, on the website of the Asset Management Association of China, specific templates for fund information disclosure have also been published.

Source: Asset Management Association of China

When it came to the specific types of measures, what did each fund company do in disclosure?

Jiemian News reporter noticed that before 2022, because regulators had not issued explicit requirements for fund companies to disclose such information, some fund companies would gloss over it in a single line, while others would provide only a simple description.

“A lot of it wasn’t clearly spelled out in actual implementation, especially what exactly needed to be disclosed and whether it had to be disclosed down to individuals—there was no clear requirement.” A compliance insider at a public fund firm said.

The same source also said that from the standpoint of fund companies, they would also try to avoid having regulatory penalties known by investors, to prevent situations where the fund would face large-scale redemptions.

However, in August 2022, the Asset Management Association of China issued “Securities Investment Fund Information Disclosure XBRL Template No. 3 ‘Annual and Interim Reports’ (2022-08-26),” and it clearly specified the disclosure format. Since then, details on inspections and penalties in fund annual reports have become more explicit.

In the latest 2026 version, the template from the Asset Management Association of China has been “upgraded” again. Not only must the major categories of investigation or penalty measures be clearly stated, but the specific penalty measures are also further broken down, and the basis for the penalties must be listed as well.

That said, there is still “room for practical operability” in actual disclosure. Taking Boshi Fund as an example, it shows that its compliance and internal controls were ordered to rectify and that some business was suspended by the Shenzhen CSRC, yet it does not clearly state which specific parts of the business were suspended or how long the suspension would last.

According to Jiemian News statistics, in 2025, 29 fund companies received investigations or penalties from regulatory authorities. Multiple leading fund companies are on the list. Regulatory measures include both administrative regulatory measures and administrative penalties. Penalty forms include issuing warning letters, ordering rectification, suspending business, and even imposing fines.

In terms of penalty types, “compliance and internal controls” and “investment operations” have become high-frequency problem areas. In some cases, due to the severity of issues, certain companies were suspended from submitting registration applications for fixed-income public fund products for 3 months.

Both Haitong Boshid and CCREAM Xin were penalized for private asset management products. Haitong Boshid faced an administrative regulatory measure of issuing a warning letter taken by the Shanghai CSRC due to issues such as noncompliant investment management in its private asset management business. CCREAM Xin was ordered to rectify and suspended from filing for new private asset management product registrations for 3 months because of problems in areas including investment operations and sales management, where some internal control systems were not complete or were not implemented effectively.

It is worth noting that some companies’ issues show a multidimensional interweaving. For example, Phicon Fund had loopholes in governance, compliance and internal controls, investment operations, and personnel management, and it also involved sales and financial management.

In addition, administrative penalty cases cannot be overlooked either. Manulife Fund was warned and fined for violating foreign exchange registration management regulations. Fangzheng Fubon Fund was also ordered to repay taxes and fined for failing to withhold and remit individual income tax according to regulations—showing that regulation is not confined to the investment business level, but extends to basic corporate compliance and tax management.

Industry insiders say that the regulatory measures disclosed in this batch of annual reports reflect regulators’ more stringent approach to governance of the fund industry. Whether for leading institutions or smaller fund companies, continued strengthening is required in areas such as compliance building, personnel management, and risk control. The industry is entering a new phase of “stronger regulation and stricter accountability.” Only by laying a solid foundation in internal controls can it go steady and far amid increasingly fierce market competition.