The London Stock Exchange Group’s discussions to sell Russell Investments to China’s Citic Securities have been derailed by the plunge in the Chinese stock market since mid-June, as well as investigations into some Citic Securities executives.

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The London Stock Exchange Group’s plan to sell Seattle-based Russell Investments to China’s Citic Securities is faltering and may soon collapse, people with knowledge of the matter said.

The plunge in the Chinese stock market since mid-June, as well as investigations into some Citic Securities executives, have derailed the discussions, the people said, asking not to be identified as the information is private.

China’s biggest listed brokerage had been in advanced talks to buy the fund-management business for about $1.8 billion, a person with knowledge of the matter said in July.

LSE has begun speaking again with other bidders for Russell Investments, according to one of the people. Talks with Citic Securities haven’t been completely shelved, another person said.

Citic Securities has become a focal point of a campaign by the Chinese authorities to root out financial wrongdoing and assign blame for the nation’s $5 trillion stock rout. President Cheng Boming is being investigated by the police, with the state-run Xinhua news agency reporting that he’s one of seven Citic Securities executives facing probes for offenses including alleged insider trading. 

“Citic is acting cautiously because they are handling various problems after the market rout, even though they’re in a solid financial position,” Edmond Law, a Hong Kong-based analyst with UOB-Kay Hian Holdings, said by phone Tuesday. “This kind of strategic move needs to be delayed at the moment. Companies may want to keep a low profile.”

A spokeswoman for Citic Securities declined to comment on the Russell talks. Lucie Holloway, a spokeswoman for LSE, declined to comment. 

The operations and management of Citic Securities are “business as usual,” and the brokerage will publish announcements if there are developments that need to be disclosed, the spokeswoman said Tuesday, asking not to be named citing company policy. No comment has been available from the seven individuals being investigated.

Once powered by a world-beating equities rally, Chinese securities firms are now undermined by a market reversal that the country’s government has been powerless to stop. The brokerages are being hobbled by waning demand for margin finance, a freeze on initial public offerings and increasing risk of customer defaults.

Shares of Citic Securities have fallen 58 percent in Shanghai trading in 2015, after coming close earlier this year to surpassing Switzerland’s UBS Group in market value.

LSE acquired Russell Investments last year as part of the larger $2.7 billion acquisition of Frank Russell Co. It wanted Frank Russell’s index business to bolster its own FTSE International division, which makes money from licensing benchmarks to creators of exchange-traded funds and other financial products.

Russell Investments oversees about $266 billion.