The China Securities Regulatory Commission on Friday announced formal penalties for an insider trading case involving China Everbright Securities Co Ltd, levying a fine of 523 million yuan ($85.7 million) and banning four managers from the nation's financial markets for life.

On Aug 16, a flaw in Everbright Securities' trading software generated 23.4 billion yuan in erroneous buy orders on the Shanghai Stock Exchange. The brokerage eventually completed 7.27 billion yuan worth of transactions.

In response to the orders, the benchmark Shanghai Composite Index surged 5.96 percent within three minutes, prompting many investors to buy stocks.