SANTIAGO, Oct 30 (Reuters) - The scandal engulfing Chile's financial industry over illicit trading of shares of companies linked to fertilizer group SQM widened on Thursday, as the regulator announced fresh fines for traders and asset managers.
The SVS financial regulator said in a statement that it was issuing fines totaling about $7 million for a series of infractions relating to trading of SQM's A shares in 2011.
Those fined were BanChile Corredores de Bolsa, a trading subsidiary of Banco de Chile, and its ex-investment manager, and CHL Asset Management Chile (formerly called Linzor) and its legal representative.
"There is clear evidence that those sanctioned took part in exchange operations in which they used mechanisms ... that were intended to trick," the SVS said.
It added that it also had evidence of rule breaking in 2009 and 2010 by Citigroup Global Markets and its executive Fabio Gheilerman but that it was prevented from issuing a fine as more than four years had passed since the event.
Usually noted for having one of Latin America's least corrupt economies, Chile has been roiled in recent months by the so-called cascadas case involving companies linked to SQM , which owns vast nitrate and lithium resources in the Atacama desert. Cascadas, or waterfalls in English, refers to the complex web of holding companies involved in the scandal.
SQM Chairman Julio Ponce, the late dictator Augusto Pinochet's son-in-law, was fined nearly $70 million in September for his part in the market manipulation scandal, with other company executives and Chile's biggest brokerage also drawn in.
Business leaders have said the case has shaken investor confidence and pension funds have threatened legal action. (Reporting by Rosalba O'Brien; Editing by Steve Orlofsky)