He is now working for the Counsellors’ Office of the PBOC – a unit within its head office that handles currency and foreign debt data, conducts research on legal, economic and financial matters, and makes recommendations to the central bank management. It has no decision-making power.
Liu was chairman of the powerful CSRC for three years before he was sidelined to the role of deputy party chief of the All-China Federation of Supply and Marketing Cooperatives in January 2019, a move that shocked the financial sector.
Four months later, Beijing said Liu had surrendered himself to the Central Commission for Discipline Inspection.
After a five-month investigation the watchdog found Liu had not upheld the principles of a party member, made inappropriate public speeches and lacked “political vigilance” and awareness of confidentiality rules. He was also found to have used his public role for personal gain, broke the rules to get jobs or promotions for others, and accepted gifts to make it easier for his relatives to buy homes.
But Liu was given a relatively light punishment – he was removed from his post at the state-run federation and put on two years’ probation within the party, meaning he could retain his membership. He was demoted to the job of a researcher and his illegal income was confiscated.
The anti-graft agency said Liu had received lenient treatment because of his “good attitude towards admitting wrongdoing”.
Liu is known as the securities regulator who dealt with the aftermath of the 2015 stock market crash that wiped out US$5 trillion in mainland China. He took the helm of the CSRC in early 2016, replacing Xiao Gang who had stepped down after introducing a circuit-breaker mechanism that spooked the market then abandoned it days later.
Like many senior officials, Liu has publicly pledged his loyalty to President Xi Jinping, and in 2017 he lauded Xi for “saving” the party, saying he had foiled a coup plot by former political heavyweights.
Professor Xie Maosong, a senior fellow with the Taihe Institute, a think tank in Beijing, said Liu’s new role suggested the party was willing to give cadres with needed experience and industry knowledge a second chance if their wrongdoings were seen as minor.
“The key here is that Liu’s case was not very serious and he turned himself in. He managed to keep his party membership and is still considered a comrade,” said Xie, who is also a senior researcher at Tsinghua University’s National Institute of Strategic Studies.
“The PBOC’s Counsellors’ Office is a good match for Liu Shiyu’s professional ability and work experience,” he added.
