An individual investor watches stock prices at a stock exchange in Nanjing, East China's Jiangsu Province on Monday. Photo: VCG

Stock prices of 18 listed Chinese companies plunged on Monday after allegations by a private equity fund manager that they might be involved in capital market manipulative activities.
 
The 18 public companies were embroiled in stock prices manipulation, according to Ye Fei, a manager of a private equity fund, including ZOY Home Furnishing Corp and Visionox, a display manufacturer.
 
On Monday, at least five companies have hit their downward limit upon market opening. ZOY Home Furnishing Corp dropped by 8 percent, and Visionox’s price was down by nearly 8 percent.
 
Companies with ST tags, which suggest that they have been suffering losses for at least two consecutive years, also plunged on Monday.

Ye said on Monday that the price fall in those companies’ prices is expected, adding that “it is common sense that no good company will pay for the so-called valuation management.”
 
Controversies around share price manipulation are rising on China's twitter-like social media platform Sina Weibo. Ye revealed on May 9 that stock price manipulations by listed companies were taking place under the guise of "valuation management". 

According to Ye, the prices of some listed companies' shares can be driven as much as 30 percent higher through secret manipulation schemes involving the companies, private equity funds and even public common funds. 
 
The China Security Regulatory Commission (CSRC) announced that it has begun an investigation into the allegations, including into companies like Jiangsu Lettall Electronics Co and ZOY Home Furnishing Corp.
 
Global Times