BEIJING, April 19 -- The securities regulator said it has ordered Tiantong Securities to shut down after discovering the brokerage had misused around 1.4 billion (US$175 million) in clients' funds.

　　"Since Tiantong Securities misused a large amount of clients' transaction sett lement money, it is no longer qualified to continue its business...we decided to revoke Tiantong's business license and order it to shut down," the China Securities Regulatory Commission said in a statement.

　　The statement, dated March 17, was posted on the regulator's Web site Friday.

　　Tiantong's securities assets will be taken over by Qilu Securities Co., a mid-sized brokerage based in the eastern province of Shandong, and its other assets will be taken over by an asset management company, the Shanghai Securities News reported yesterday.

　　The China Securities Journal reported in February that a new brokerage would be formed by incorporating Tiantong's securities assets with Qilu Securities. State-owned investment vehicle China Jianyin Investment Ltd. would inject 800 million yuan into Qilu Securities ahead of the restructuring.

　　Officials at Shandong-based Tiantong Securities weren't immediately available for comment.

　　Domestic brokerages have been hit by a number of financial scandals and bankruptcies in recent years, and the sector has suffered from a protracted slump and poor liquidity on the domestic stock market.

　　(Source: Shenzhen Daily/ Agencies)