Reported by: Eleanor Olcott

The US Securities and Exchange Commission had charged Cheetah Mobile chief executive Sheng Fu and its former president and chief technology officer Ming Xu. Its action came 10 months after a Financial Times investigation found that in 2016, Fu initiated share sales worth as much as $31mn a few weeks before reporting quarterly results that sent Cheetah shares plummeting 30 per cent.

Cheetah Mobile is a Beijing-based mobile internet company that operates a series of platforms, including privacy protection and photo-collage applications. It did not respond to a request for comment.

In 2015, around one-third of Cheetah Mobile’s revenues were generated from fees for advertising space in its applications, according to the SEC order. The company’s ad revenues fell by around 30 per cent in the first quarter of 2016 to $33mn.

The SEC said that Fu and Xu jointly established a trading plan “after becoming aware of a significant drop-off in advertising revenues from the company’s largest advertising partner”.

The Cheetah Mobile executives cashed out through plans that allow insiders to buy and sell shares in advance when they are unaware of material non-public information.

Read full report: https://www.ft.com/content/95dee8d8-8219-460d-ad7e-f1a36b05ff1b