Fuxingsi fund-raising fraud case found out: 36.565 billion raised funds were misappropriated

 Fuxingsi fund-raising fraud case found out: 36.565 billion raised funds were misappropriated

Reporter: Manle

Recently, the CSRC issued a decision on the market prohibition of seven responsible persons including Zhu Yidong, Zhao zhuoquan and Yu Liang, which showed that Fuxing was suspected of fund-raising fraud, and the fund of RMB 36.565 billion was not used according to the agreed purpose.

According to the survey, there are 160 private fund products issued and filed by Fuxing private equity institution. The main investment fields of private fund products are partnership shares, equity, creditors rights, project income rights, etc. The registered 160 private fund products raised a total principal of 36.845 billion yuan.

However, these 160 products are all agreed to be invested in the equity, equity income right, creditors rights, operation income right and other assets of 43 Fuxing related companies such as Fujian Group Co., Ltd. Among the raised funds, except the balance of funds retained in the fund-raising account and the account of the investment target company, the rest of the funds are not used according to the agreed purpose and belong to the misappropriation of fund property, with a total amount of 36.565 billion yuan, accounting for 99.37% of the total amount of funds.

Among them, Zhu Yidong and others used part of the funds for commission reward and personal waste. The amount of commission is 604 million yuan, and the amount used for personal waste is 65 million yuan, which constitutes misappropriation of fund property, and the amount misappropriated is 669 million yuan.

In addition, according to the investigation of regulatory agencies, Fuxing Group also uses the accounts of Fuxing related companies or related natural persons to transfer funds to Fuxing private equity institutions in a unified way. The fund operation has obvious characteristics of fund pool. Among them, there are 24 accounts with the characteristics of capital pool, accounting for 4.87% of the total number of units or natural person accounts involved in the capital flow, but the total amount of capital in and out of the capital pool is 797.6 billion yuan, accounting for 44.62% of the total amount of capital flow obtained for analysis.

After the fund product is raised, the amount transferred into the fund pool immediately after the fund is put into the investment account is 29.275 billion yuan, accounting for 79.46% of the total raised funds; after the fund is directly transferred into the accounts of other related parties or other units and natural persons, the amount transferred into the fund pool of related parties again through the fund transfer is 5.571 billion yuan, accounting for 15.12% of the total raised funds. To sum up, the total amount of raised funds transferred from the investment account to the related party fund pool finally reached 34.846 billion yuan, accounting for 94.58% of the total raised funds.

In addition to the above-mentioned facts of fund-raising fraud, Fuxing private equity institutions also have the problems of publicizing and promoting private equity products to unspecified investors, promising to investors that the investment principal will not suffer loss and minimum return, failing to disclose the possible conflict of interest to investors in accordance with the contract and major information that may affect the legitimate rights and interests of investors.

Based on the above facts, the CSRC decided to take lifelong measures to ban the entry of securities market to Zhu Yidong and Zhao zhuoquan, who are directly in charge of Fuxing department, as well as the chairman and President of Fuxing Group. Xu Liang, the principal of Fuxing private equity institution, was banned from entering the securities market for ten years, and the rest of the people involved were banned from entering the securities market for three years.

It is worth noting that in 2018, Zhu Yidong was just banned from the securities market by the CSRC for three years, because he conspired with others to manipulate Dalian electric porcelain stock. As a typical example of actual controllers of listed companies abuse information advantages to collude and manipulate the market inside and outside, the case was included in 20 typical illegal cases of securities regulatory inspection in 2018. Zhu Yidong was also fined 600000 yuan for this case, and Fuxing Group was also fined 1 million yuan.

Source: editor in charge of interface news: Zhong Qiming