Key keywords: illegal cross-border stock trading, Tiger Brokers, Futu Holdings, China Securities Regulatory Commission, cross-border securities business license, mainland individual investors, overseas stock investment, financial risk prevention On December 30, 2022, the China Securities Regulatory Commission (CSRC) officially issued a public statement announcing that it had ordered leading online brokerage platforms Tiger Brokers and Futu Holdings to immediately cease their illegal cross-border securities business activities targeting mainland Chinese investors. The regulatory action came after a months-long investigation that found both NASDAQ-listed firms have been operating without a valid securities business license in mainland China for years, while actively marketing their services to domestic residents to facilitate trading of Hong Kong, U.S. and other overseas stocks. According to the CSRC’s announcement, Tiger and Futu’s unregulated operations have violated multiple provisions of China’s Securities Law and Regulations on the Administration of Foreign Exchange, posing prominent risks to investor interests and cross-border financial stability. Investigators found that the two platforms have collected large volumes of sensitive personal information from mainland users, failed to establish proper investor suitability assessment mechanisms, and did not fulfill their obligations to disclose risks related to overseas market fluctuations and cross-border fund transfers. The regulatory measures require the two firms to stop accepting new mainland Chinese users immediately, and to adjust their business operations to ensure that existing services for mainland clients comply with Chinese laws and regulations. The CSRC also noted that it will work with relevant financial management departments to explore the establishment of legal, transparent channels for mainland residents to conduct overseas securities investment in accordance with the principles of controllable risks and orderly development. Following the announcement, shares of Tiger Brokers and Futu Holdings fell by more than 12% and 10% respectively in after-hours trading on the NASDAQ. Industry insiders pointed out that this crackdown is part of China’s ongoing efforts to standardize cross-border financial services, close regulatory loopholes, and protect the legitimate rights and interests of ordinary financial consumers. Regulators have repeatedly emphasized that any institution providing financial services to mainland residents must obtain the corresponding business license and strictly abide by domestic regulatory requirements, regardless of where the institution is registered or listed. The move also aligns with China’s broader regulatory agenda to contain systemic financial risks and maintain the stability of the domestic financial market in the post-pandemic era.