Penalty 1.76 billion! Chairman of the board of directors organized a group to manipulate 32 accounts of stocks to speculate and reduce holdings

category:Finance
 Penalty 1.76 billion! Chairman of the board of directors organized a group to manipulate 32 accounts of stocks to speculate and reduce holdings


Three people work together to operate 32 securities accounts

The account group involved in the case includes:

First, Mingli group, Guangxi tianhun Logistics Service Co., Ltd. (hereinafter referred to as tianhun logistics), Guangxi Fangchenggang Hengxin Chemical Co., Ltd. (hereinafter referred to as Hengxin chemical), Guangxi Guidong Phosphorus Industry Investment Co., Ltd. (hereinafter referred to as Guidong phosphorus industry), Qinzhou shendatong Industry Co., Ltd. (hereinafter referred to as shendatong), Guangxi Industrial Innovation Information Consulting Co., Ltd. (hereinafter referred to as shendatong) 7 accounts (hereinafter referred to as corporate securities account) of Nanning qiangshun Agricultural Materials Co., Ltd. (hereinafter referred to as qiangshun agricultural materials);

Second, 21 accounts (hereinafter referred to as natural person securities account) including natural person Lu, Li (controlled before July 31, 2015) and Chen (controlled before June 19, 2015);

Third, there are four accounts (the above account is hereinafter referred to as the securities account of the asset management plan) of Huamao capital Huatong No. 1 securities investment fund, Xiyu robust new third board No. 2 securities investment fund, zhongkewotu preferred No. 1 asset management plan and guohemingway No. 1 collective asset management plan.

Lin Jun, He Zhonghua and Chen Zhiqiang control the use of the above securities account groups:

First, the seven companies involved in the case corresponding to the seven corporate securities accounts of Mingli group are actually set up, controlled and managed by Lin Jun and He Zhonghua successively, and the corresponding securities accounts and passwords are opened according to the instructions and arrangements of Lin Jun or He Zhonghua and then handed over to Chen Zhiqiang for use.

Second, Lu and other account nominees acknowledge that their securities accounts and passwords will be used by Chen Zhiqiang through Lin Jun.

Fourth, Lin Jun admits to controlling part of the securities accounts, while Chen Zhiqiang admits to controlling all the securities accounts under Lin Juns instruction.

Fifth, the computers and trading addresses used by the account group to place orders coincide with each other, and coincide with the operating order computers seized by the investigation group on site.

Sixth, Lin Jun refers to the bank account that the companys employees control the capital flow of the account group.

According to the investigation of China Securities Regulatory Commission, there is a close relationship between the account groups trading of Mingli shares of companies listed on the new third board and Lin Jun. Lin Jun instructs He Zhonghua to arrange Mingli groups staff to operate the capital flow of the corporate securities account. The capital source of the natural person securities account is Lin Juns own capital, loan and capital allocation. The capital management plan securities accounts are all It is provided by Lin Jun with full funds for warehouse construction and replenishment.

Lin Jun instructs He Zhonghua, Chen Zhiqiang and the companys employees to operate the legal person securities account and the natural person securities account to trade Mingli shares, and Chen Zhiqiang and others conduct transactions through their respective office computers. Lin Jun ensured that the securities account of asset management plan continued to buy Mingli shares by adding inferior funds.

Two ways to expose

Lin Jun organized and directed He Zhonghua and Chen Zhiqiang to control the account group, centralized the advantages of capital and shareholding, and used various means to manipulate Mingli shares. The first transaction of Mingli shares occurred on April 24, 2015 and was suspended on December 23, 2016, with a total of 255 trading days.

One is to continuously buy and sell and manipulate the stock price and trading volume of Mingli shares with the advantages of centralized capital and shareholding.

The account group strengthened its shareholding advantage by participating in two private placements. Mingli group holds 49.5 million original shares of Mingli. On March 23, 2015, Mingli Co., Ltd. issued 75 million additional shares for the first time, including 35 million shares subscribed by Hengxin chemical and 33.075 million shares subscribed by Guidong phosphorus industry. On May 24, 2015, Mingli Co., Ltd. issued 24 million additional shares for the second time, including 100 million shares subscribed by Mingli group, 21.44 million shares subscribed by Hengxin chemical, 25 million shares subscribed by Guidong phosphorus industry, 18 million shares subscribed by industrial innovation information, 17.6 million shares subscribed by Tianxun logistics and 17.2 million shares subscribed by qiangshun agricultural capital.

The account group concentrated capital advantage and stock holding advantage to manipulate the stock price and trading volume of Mingli shares continuously. From April 24, 2015 to December 23, 2016, Mingli shares were traded on average in each trading day of the account group, with a trading volume of 1142.914 million shares and a trading volume of 5.667 billion yuan. The total trading volume of Mingli shares in the same period was 1466.215 million shares and a trading volume of 7.039 billion yuan. The trading volume of Mingli shares in the account group accounted for 77.9% of the total trading volume in the market, and the trading volume of account composition accounted for 77.9% of the total trading volume 80.5% of the total turnover in the market.

The account group continues to trade a large number of Mingli shares, resulting in the market average transaction price greatly affected by the transaction price of Mingli shares traded by the account group. During the manipulation period, the average transaction price of Mingli shares traded by the account group on that day did not deviate from the average transaction price of the market for 59 trading days, accounting for 23.14% of the total trading days; the difference between the average transaction price of the account group on that day and the average transaction price of the market for 211 trading days, accounting for 82.75% of the total trading days; the difference between the average transaction price of the account group and the average transaction price of the market for 226 trading days, accounting for 88.63% of the total trading days.

During the agreement transfer period (from April 24, 2015 to June 18, 2015, a total of 39 trading days), the account group has 36 trading days to trade between the accounts under its actual control, and the trading amount in the account group is 126.6908 million yuan, accounting for 35.98% of the total trading amount of 35208949 yuan of Mingli shares.

During the market making transfer period (from June 19, 2015 to December 26, 2016, totaling 216 trading days), although the account group controlled by Lin Jun trades through the market maker, it actually achieves the purpose of trading stocks among different accounts controlled by him and increasing the trading volume, with obvious false trading intention.

First, the proportion of shareholding change is low. During the market making and transfer period, the number of shareholding changes (former reversion) in the account group was 45.9295 million shares, while the number of trading shares (former reversion) in the account group during the same period was 107.11185 million shares, and the proportion of changes in the shares held by the account group was only 4.29%.

Second, the account group frequently makes declarations with opposite trading direction, same or roughly the same quantity, continuous time and similar price.

The most typical trading periods are:

During the period from 9:30:29 to 14:59:36 on August 5, 2015, the account group purchased 853000 shares in total, with an average purchase price of 3.95 yuan, and sold 853000 shares in total, with an average sale price of 3.94 yuan. The total number of transactions was 267, with an average interval of 53.90 seconds;

From 9:30:00 to 14:58:00 on September 18, 2015, the account group purchased 2.999 million shares in total, with an average purchase price of 4.67 yuan, and sold 3 million shares in total, with an average sale price of 4.67 yuan. The total number of transactions was 366, with an average interval of 39.13 seconds;

During the period from 9:30:22 to 14:59:20 on December 11, 2015, the account group purchased 8.084 million shares in total, with an average purchase price of 5.59 yuan, and sold 8.075 million shares in total, with an average sale price of 5.59 yuan. The total number of transactions was 428, with an average interval of 33.58 seconds.

Third, most of the transactions in the account group are directly reported and concluded by market makers. During the period of market making transactions, the number of transactions declared by the account group with the quotation of market makers was 57788, accounting for 94.65% of the total number of transactions 61054; the number of transactions declared by the account group with the quotation of market makers was 996.764 million shares, accounting for 92.18% of the total number of transactions 1081.33 million shares. Lin Juns control account group directly reports market makers quotation. In fact, it uses the trading system characteristics of market makers continuous bilateral quotation and accepting the trading requirements of investors at this price to conduct frequent transactions between the accounts under its control, create the illusion of active trading of Mingli shares, and achieve the purpose of manipulating the stock price and trading volume of Mingli shares.

To sum up, from April 24, 2015 to December 24, 2016, Lin Jun, He Zhonghua and Chen Zhiqiang affected the trading volume of Mingli shares by adopting the way of continuous trading with centralized capital advantage, shareholding advantage and trading between securities accounts under their own actual control, resulting in the illusion that Mingli shares were active in trading, and the trading volume and turnover were ranked in the new three boards of China Fourth, attract a large number of investors and market makers to actively follow up the purchase of Mingli shares, maintain the stock price, in order to achieve the purpose of reducing the holding of shares. The net number of shares decreased by the account group was 73.2905 million, excluding the amount of shares purchased and the cost of the net shares decreased by the account group. The total profit of the account group was 293.4248 million yuan.

The CSRC holds that, as the actual controller of Mingli, Lin Jun is the organizer, decision maker and main implementer of the above-mentioned illegal acts; He Zhonghua and Chen Zhiqiang are specifically responsible for controlling the relevant transactions of the account group and are the main implementers of the above-mentioned illegal acts. He Zhonghua and Chen Zhiqiang are other directly responsible personnel.

Lin Jun, He Zhonghua, Chen Zhiqiang and their agents put forward the following statements and arguments: first, there are problems of unclear facts and wrong calculation in the determination of illegal income. First, there is no factual basis for determining the cost as zero, and any securities transaction has objective transaction costs. Even if the borrowing funds are used to subscribe for fixed increase shares, there is still a legal creditor debt relationship between Mingli shares and the subscribers, which is the cost of subscription for fixed increase shares. Second, the failure to consider that the remaining shares belong to the error of fact determination, and the confirmation of directional increase is confirmed in advance notice It is one of the means of manipulation. It should be regarded as the means and tools of manipulation to increase the shares held by fixed amount. When calculating the profit, it should be combined and calculated. However, the method of net reduction of shares in this case is not consistent with the previous case.

Second, the responsibility of this case is not consistent with the facts, and the amount of punishment is improper. The first is that Lin Jun has no subjective intention to manipulate the securities market; the second is that the particularity of the new third board market determines that the social harm of this case is relatively light; the third is that He Zhonghua and Chen Zhiqiang have no motive and intention to manipulate the market for profit, and they have not obtained improper benefits due to market manipulation; the fourth is that the amount of punishment in this case is too large. To sum up, it is requested to be given a lighter, mitigated or exempted punishment.

Upon review, the CSRC believes that:

First, the particularity of the manipulation in this case lies in that Lin Jun and others build positions by subscribing for fixed increase stocks in the primary market, so their fixed increase behaviors and manipulation behaviors should be considered as a whole. The parties argued that the cases determination of zero cost was inconsistent with the CSRCs prior notice. After investigation, according to the actual situation of the case, the CSRC has calculated the fixed increase stock cost of the actual investment part (150 million yuan) of Mingli group, and the other parts not actually invested are determined to have no fixed increase cost, which is not inappropriate. At the same time, the method can simplify the dynamic changes in the trading process, reflect the final state of the changes in the number of shares, and then fully reflect the objective profit and loss situation, so it is more reasonable to calculate the illegal income with the method;

Second, in order to obtain capital and shareholding advantages, Lin Jun directly decided to use the borrowed funds for the purchase of fixed value-added shares in six corporate accounts and provide funds for other individuals and asset management accounts, and the account group subscribed shares through the primary market to build a position, and directly directed Chen Zhiqiang, he Zhonghua and the companys employees to operate the account group to trade Mingli shares. Lin Jun manipulated the market Its objective behavior fully reflects that Lin Jun has the subjective intention to manipulate the market. At the same time, the illegal nature of the case is bad, the parties have transferred funds out of the country, manipulated a large amount of money, and disturbed the market price and trading volume of the new third board, so the partys claim that the social harm of the case is less is inconsistent with the facts;

Third, He Zhonghua and Chen Zhiqiang play a secondary role in the manipulation. The CSRC has fully considered the participation degree of the two people to make responsibility determination and punishment, and the amount of punishment is appropriate. To sum up, the CSRC will not adopt the above defense opinions.

55 days for 5 cases of manipulation

In addition to the above-mentioned cases, the CSRC recently punished another four cases of market manipulation.

First, the CSRC reported on January 3 that Luo Shangdong, the actual controller of Hunan Dongneng group, conspired with Gong Shiwei, the intermediary of over-the-counter capital allocation, and other people to raise funds to manipulate the prices of 8 shares, including dibe electric, with profits of more than 400 million yuan. In the investigation and handling of the case, the public security organ, with the cooperation of the law enforcement force of the CSRC, arrested 43 main members of the gang, and destroyed 12 illegal trading dens. This case was prosecuted by the peoples Procuratorate of Jinhua City, Zhejiang Province, and the intermediate peoples Court of Jinhua City recently made a first instance decision.

Third, on November 18, 2019, the CSRC issued a number of administrative punishment decisions and market banning decisions. The controlling shareholder, actual controller and former chairman of the board of directors of Jinlihua power were fined 1.5 million yuan for manipulating the market, and were banned from entering the securities market for 10 years, accompanied by the former Secretary of the board of directors, chief financial officer and capital allocation personnel of Jinlihua power. In the 534 trading days of market manipulation, the account group has bought 2.697 billion yuan and sold 2.106 billion yuan in total, and 325 trading days with shareholding accounting for more than 5% of the total share capital.

Through investigation, from October 2015 to April 2018, Zhao Jian and Lou Jinping, the former Secretary of the board of directors and chief financial officer, controlled 109 securities accounts involved in the case, and Zhu Panfeng, the funding intermediary, controlled three securities accounts, totaling 112 securities accounts dealing with Jinlihua power. As of August 29, 2018, the involved account group held 7100 shares of Jinlihua power, with a cumulative loss of RMB 157 million.

Fourth, on November 14, 2019, the CSRC imposed an administrative penalty on the case of Lu le and Chen Zhilong manipulating the securities market, confiscating the illegal income of Lu le of 15074909.85 yuan and a fine of 30149819.70 yuan; confiscating the illegal income of Chen Zhilong of 26009.28 yuan and a fine of 52018.56 yuan. According to the investigation, from December 2015 to July 2016, LV Le, alone or in collusion with Chen Zhilong, manipulated the prices of three stocks such as fida environmental protection through continuous trading, and in addition, LV Le manipulated the prices of stocks by trading fida environmental protection between accounts under his actual control.

According to the analysis, the trading time of the stocks involved in the case is basically the same, and the methods are basically the same. Generally speaking, they show the characteristics of single large single purchase and multiple batch sales at the time of purchase and sale. There is cooperation in the trading process, and the stock price is pulled up alternately at the tail market stage, and there is cooperation behavior of pulling up or maintaining the stock price during the selling process of the other party. The case belongs to short-term manipulation, with most of the stock price rising less than 3% or even less than 2%. However, due to the small amount of capital needed for short-term manipulation and the high capital turnover rate, although the stock price rising is limited, the profit is considerable. LV Le makes 15 million yuan, and Chen Zhilong makes 26009 yuan. The new securities law just deliberated and passed has strengthened the crackdown on illegal securities acts. For those who manipulate the securities market, the securities law provides that they shall be ordered to deal with the securities they illegally hold according to law, their illegal gains shall be confiscated and they shall be fined not less than one time but not more than ten times of their illegal gains; if there are no illegal gains or their illegal gains are less than one million yuan, they shall be fined not less than one million yuan but not more than ten million yuan. If a unit manipulates the securities market, it shall also give a warning to the persons who are directly in charge and other persons who are directly responsible, and shall also impose a fine of not less than 500000 yuan but not more than 5 million yuan. Securities company China Chengdan source: Securities Company China responsible editor: Yang bin_nf4368

According to the analysis, the trading time of the stocks involved in the case is basically the same, and the methods are basically the same. Generally speaking, they show the characteristics of single large single purchase and multiple batch sales at the time of purchase and sale. There is cooperation in the trading process, and the stock price is pulled up alternately at the tail market stage, and there is cooperation behavior of pulling up or maintaining the stock price during the selling process of the other party. The case belongs to short-term manipulation, with most of the stock price rising less than 3% or even less than 2%. However, due to the small amount of capital needed for short-term manipulation and the high capital turnover rate, although the stock price rising is limited, the profit is considerable. LV Le makes 15 million yuan, and Chen Zhilong makes 26009 yuan.

Securities company Chengdan, China