According to a report by First Financial on May 28, Futu and LongBridge have begun clearing two types of accounts and processing account closures: accounts opened using fake or suspicious proof materials, and empty accounts with no assets or positions.
Confirmation scope of clearing for the two types of accounts and updated guidance for overseas identity users
Futu NiuNiu customer service confirmed to First Financial that the scope of accounts to be closed in this cleanup is limited to two categories: accounts opened using fake or suspicious documents, and empty accounts with zero balance that have not been moved. Accounts opened in normal compliance with genuine assets and positions are not included in the cleanup scope. LongBridge’s client notification also confirmed the same two cleanup categories.
In the Futu NiuNiu APP, a new shortcut entry “Update Identity Information” has been added under “Account,” with the accompanying note: if customers hold overseas identity documents that meet the requirements, after updating, all business matters such as account trading and fund deposits/withdrawals will not be affected in any way, and it applies whether the overseas identity was obtained before or after opening the account. The categories of overseas identity documents that meet the requirements are as follows:
Hong Kong: Permanent Resident Identity Card, Non-Permanent Resident Identity Card (Temporary Identity Card), work visa, or study visa
Singapore: Permanent Resident Identity Card (PR), work pass (EP/SP/overseas category) or student pass
China Securities Regulatory Commission’s confirmed administrative penalty procedure for Futu
The China Securities Regulatory Commission and the Shenzhen branch confirmed that multiple FUTU entities have engaged in securities trading, public fund sales, and futures brokerage businesses in mainland China without obtaining the necessary domestic licenses. The proposed corporate fine amount is 1.85 billion yuan (about $271 million), and it is also proposed to impose a personal fine of 1.25 million yuan (about $183,575) on Mr. Li Hua, the founder and CEO of the Futu Group.
FUTU stock plunged on May 22 as a result. The above fines are currently in the stage of a pre-notification letter and have not been finalized; as of the time of the report, Futu has not issued an official response regarding the final penalty.
Confirmation framework of the joint scheme by eight departments: a 2-year rectification period and shutdown provisions
The “Comprehensive Rectification Scheme” sets a 2-year centralized rectification period, confirming the following restrictions: during the rectification period, overseas institutions are prohibited from providing new buy transaction services and funds transfer-in services to existing mainland investors; only one-way sell transactions are allowed and funds may be transferred out. After the 2-year rectification period ends, overseas institutions must completely shut down websites, trading software, and related supporting services facing mainland China.
Futu NiuNiu customer service confirmed that, as of now, there are no specific regulatory implementation rules for the 2-year centralized rectification period. All existing account services are operating normally, and Futu will promptly notify customers of policy updates through official announcements and channels such as the APP. Futu confirmed that, as of the end of Q1 2026, mainland clients account for about 13% of its total margin financing accounts.
Common Questions
Do Futu or LongBridge users holding overseas identity documents need to worry about their accounts being cleared?
According to Futu NiuNiu’s confirmed statement, this cleanup only targets accounts opened with fake documents and empty accounts with zero balances that are not moved. Futu customer service confirmed that the new rules effective May 22 only affect “investors who only hold mainland China identity cards or mainland passports.” For users who hold overseas identity documents that meet the requirements, such as those from Hong Kong or Singapore, account trading and fund services are not affected.
At what legal procedural stage is the China Securities Regulatory Commission’s proposed fine of 1.85 billion yuan for Futu currently at?
According to the confirmed report by First Financial, the China Securities Regulatory Commission has issued an administrative penalty “pre-notification letter” to Futu’s relevant entities, which is a pre-stage procedure for administrative penalties; the fine has not yet been finally determined. The corporate fine proposed in the pre-notification letter is 1.85 billion yuan, and the personal fine is aimed at founder and CEO Li Hua, amounting to 1.25 million yuan.
What specific restrictions does the 2-year centralized rectification period impose on existing mainland stockpile users?
According to the confirmed provisions of the “Comprehensive Rectification Scheme,” during the rectification period, adding new buy transactions and transferring in funds are prohibited for existing mainland investors; only sell transactions and transferring out funds are allowed. After the rectification period ends, there will be a comprehensive shutdown. As of May 28, 2026, Futu customer service confirmed that there are still no specific regulatory implementation rules, and Futu will continue to monitor and notify promptly.
