China’s securities markets have been experiencing high growth this year. The Shanghai Stock Exchange is now ranked as the fourth largest stock exchange of the world. So, who is protecting the Chinese investors in this fast growing and potentially volatile market? The Incomplete Law Theory of Pistor and XU contends that regulators, as they are more efficient, play a more dominate role than the judiciary in protecting investors in the securities markets. This theory to some extent explains why the China’s judiciary has been inactive in protecting investors in China, the host of the third largest securities market in the world. However, this article finds that the theory is not able to adequately explain the investor protection mechanism in China. We find that by deploying various political resources, the Chinese state plays a direct role in protecting the interest of investors that is often more significant than that played by judicial or regulatory authority action.