He earned 346 million by manipulating 1 stocks, but was fined nearly 1 billion 400 million.

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 He earned 346 million by manipulating 1 stocks, but was fined nearly 1 billion 400 million.


Yesterday (November 2nd) noon, the official website of the SFC announced an administrative penalty decision. Wang Fatong, the protagonist in the punishment decision, trades between securities accounts under his actual control by means of capital advantage, shareholding advantage and continuous trading. Through the above means, Wang Fatong manipulated three stock prices in Shanghai, such as Tong Share, Qingyuan Share and Yazhen Home, making an illegal profit of 346 million yuan. The Commission confiscated illegal gains from Wang FA copper and imposed a fine of 1 billion 43 million yuan, totaling 1 billion 389 million yuan.

Information map (photo source: Vision China)

Daily economic journalists noted that Wang Fatong began to manipulate the three stocks for 1 to 2 months after their listing. Looking back at the stock price performance of these stocks during Wang Fatongs manipulation, they all had the strange trend of roller coaster.

At noon on Friday, the official website of the Securities Regulatory Commission published a decision on administrative penalties, which amounted to nearly 1.4 billion yuan. According to the punishment decision, Wang Fatong manipulated the prices of Rutong Share, Qingyuan Share and Yazhen Home in Shanghai and other places by using 344 securities accounts such as Xie Mouwei and its own funds and allotment funds. According to the evidence of hardware information (IP, MAC, hard disk serial number, single phone number), fund exchange, witness testimony and so on, 344 securities accounts such as Xie Mouwei are closely related and controlled by Wang Fatong.

Daily economic journalists noted that in the process of manipulating Rutong shares in 227 securities accounts controlled by Wang Fatong, the share price of Rutong shares rose from 24.49 yuan on December 30, 2016 to 35.64 yuan on March 14, 2017, an increase of 45.53%, with a maximum of 133.16% and 22.12% during the period. During the period from January 3 to March 14, 2017, 69.9315 million shares were bought and sold by the account group involved, amounting to 2.373 billion yuan and 2.724 billion yuan. In accordance with the FIFO method and deducting taxes and fees, Wang Fatong manipulated the price of Tong Tong and made a profit of 346 million yuan.

In the process of using 229 securities accounts controlled by Wang Fatong to manipulate Qingyuan shares, the share price of Qingyuan shares rose from 20.44 yuan on February 17, 2017 to 43.05 yuan on April 14, an increase of 110.62%. Between April 25, 2017 and May 11th, Qingyuan shares rose 39.24% and the amplitude was 134.43%. From February 20 to May 11, 2017, the Account Group involved in the case held zero shares of Qingyuan Stock. During the period, 77.355 million shares were purchased, amounting to 2.612 billion yuan. During the period, 76.533.2 million shares were sold, amounting to 2.527 billion yuan. According to FIFO and deduction of taxes and fees, Wang Fatong manipulated the price of Qingyuan Share with a real loss of 79.24 million yuan and a final balance of 76.6 million shares. As of May 11, 2017, the book loss of his shares was 11.1199 million yuan.

In the process of manipulating Yazhen Home with 261 securities accounts controlled by Wang Fatong, the share price of Yazhen Home rose from 22.10 yuan on February 17, 2017 to 35.12 yuan on April 14, with a rise of 58.91%, the highest increase being 69.05%. From February 20 to June 1, 2017, the Account Group involved in the case held zero shares of Yazhen Home. During the period, 580.95 million shares were bought, amounting to 1.802 billion yuan. During the period, 57.97 million shares were sold, amounting to 1.724 billion yuan. According to FIFO method and deduction of taxes and fees, Wang Fatong manipulated the price of Yazhen Home with a real loss of 79.215 million yuan and a final ownership of 39.5 million shares. As of June 1, 2017, his stock had a Book loss of 27.7 million yuan.

Finally, according to the facts, nature, circumstances and degree of social harm of Wang Fa-tongs illegal act and the provisions of Article 203 of the Securities Law, the SFC decides:

First, Wang Fatong confiscated 346324980.52 yuan of illegal income and imposed a fine of 1038974941.56 yuan for manipulating the price of Rutong shares.

Two, impose a fine of 2000000 yuan on Wang FA coppers manipulation of Qingyuan shares.

Three, impose a fine of 2000000 yuan on Wang FA coppers manipulation of Ya Zhen Jia.

To sum up, the confiscation of Wang FA coppers illegal income was 346324980.52 yuan, and a fine of 1042974941.56 yuan was imposed.

At the same time, the SFC decided to adopt a lifelong market ban on Wang FA copper.

Daily economic journalists noted that Wang Fatong began to manipulate these three stocks for 1-2 months after its listing, and the manipulation lasted for 2-4 months. Looking back at the stock price performance of these stocks during Wang Fatongs manipulation, they all had the strange trend of roller coaster. Finally, the stock prices of the three stocks have experienced a dramatic decline.

The reason why Wang Fatong can have a certain impact on the trend of stock price in a relatively short time is that it implements a variety of manipulation methods. Take manipulation of shares such as shares as an example, including the following:

1. Capital advantage: From January 3 to March 14, 2017, 27 trading days, 19 trading days and 9 trading days of more than 100 million yuan for the account group involved to buy Rutong shares with an amount exceeding 20 million yuan. In February 22, 2017, the turnover reached a maximum of 208 million yuan.

2. Shareholding Advantage: From January 3 to March 14, 2017, 26 trading days, 24 trading days, 22 trading days, more than 30%, 20 trading days, 14 trading days, 14 trading days for more than 50% of the unrestricted circulating shares held by the account group involved, accounted for more than 10% of the unrestricted circulating shares, and the highest proportion was reached on February 10, 2017. To 59.07%.

3. Continuous trading: In the 46 trading days from January 3 to March 14, 2017, 43 trading days (93.48%) of the account group involved traded Rutong shares, 13.69% of the market volume, 27 trading days with more than 10%, 18 trading days with more than 20% and 3 trading days with more than 30% exceeding 30%. There are 1 trading days in excess of 40%. In February 9, 2017, the volume of transactions accounted for 40.15% of the market volume.

4. Transaction between securities accounts under their actual control: 29 trading days in the account group involved in the case traded 104.89 million shares of Rutong Shares between securities accounts under actual control, and 9 trading days in which the number of Rutong Shares traded between securities accounts under actual control accounted for more than 5% of the market turnover on that day. There were 3 trading days in excess of 10%, and the highest proportion reached 22.12% in February 9, 2017. In addition, the account group involved in the early morning, intraday and late stock prices.

Wang Fatong manipulates the price of Qingyuan Share and Yazhen Home in a similar way. The account group involved in manipulating the price of Yazhen Home still has the situation of raising the opening price and the stock price in the market.

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