Supplementary information:
According to the existing relevant laws and regulations in China, the financial management of stock trading on behalf of clients can be operated through legal private placement and public offering by fund companies, or through financial products developed by investment banks, insurance companies and securities companies. Although it is possible (or possible) for other institutions or individuals to trade stocks on behalf of customers (without professional qualifications), this kind of contract is not a standardized trust contract or entrustment contract stipulated in China's contract law. Therefore, although it cannot be said that this kind of private financial management is a serious illegal act, at present, in our country, this practice is at least not protected by law. If both parties or one party suffers investment losses, it will be difficult to safeguard their legitimate rights and interests through legal channels.
Extended data:
1. Generally speaking, legal financial management on behalf of clients belongs to the asset management business of securities companies. According to the law, with the approval of the regulatory authorities, securities companies can handle directional asset management business, collective asset management business and special asset management business for customers. Illegal financial management on behalf of clients is often the behavior of securities company employees who accept clients' entrustment privately and engage in securities investment and financial management without authorization.
2. The risk of violating "financial management on behalf of customers" is enormous. For investors, at present, securities companies prohibit employees from engaging in illegal financial activities on behalf of customers, take a series of preventive measures, and reveal risks during the telephone call back to investors. In this case, if investors still entrust employees with financial management privately, it is generally recognized as employees' personal behavior. Once investors violate the rules and make losses on behalf of customers, securities companies do not have to bear legal responsibilities, and investors can only claim legal responsibilities from employees.
3. For securities companies, with the unpredictability of market conditions, the hidden risks brought by employees illegally operating accounts on behalf of customers will gradually emerge. Once the loss of customer accounts operated by employees exceeds the customer's tolerance, it will lead to customer complaints that the business department does not manage the securities firms in place, which may also lead to legal risks.