China News Service, May 14th, according to the website of the China Securities Regulatory Commission, the Securities Regulatory Commission recently made administrative penalties and market ban decisions on Kangmei Pharmaceutical's violations of laws and regulations, and decided to order Kangmei Pharmaceutical to correct, give a warning, and punish 600,000 RMB fine, 21 fines ranging from 900,000 yuan to 100,000 yuan fines, 6 major responsible persons from 10 years to lifetime securities market ban measures. Relevant intermediaries are suspected of illegal or illegal behaviors in the administrative investigation and review procedures. At the same time, the SFC has transferred Kangmei Pharmaceutical and related personnel to the judicial organ for suspected criminal behavior.
The Securities and Futures Commission finally determined that between 2016 and 2018, Kangmei Pharmaceutical had inflated huge amounts of operating income, forged or altered large fixed-term deposit receipts, and inflated monetary funds, and included engineering projects that did not meet the accounting confirmation and measurement conditions into the report. Inflated fixed assets, etc. At the same time, Kangmei Pharmaceutical has non-operating funds occupied by the controlling shareholder and its related parties. The above-mentioned behavior caused false records and major omissions in the relevant annual report disclosed by Kangmei Pharmaceutical.
Kangmei Pharmaceutical has premeditated, organized, long-term and systematic financial frauds, tramples on the rule of law, has no awe to the market and investors, and seriously damages the healthy ecology of the capital market. After the SFC found out that the case involved violations of the law, it immediately concentrated on investigating and prosecuting, and continued to announce the progress of law enforcement. During the epidemic, a hearing was held through remote video conferences in multiple places to listen to the parties ’statements and defenses.
The CSRC reiterated that the information disclosure system is the cornerstone of the healthy development of the capital market, and operating in good faith in accordance with the law is the most basic market discipline. Some listed companies disregard laws and regulations and implement financial fraud and other bad behaviors that infringe on the interests of investors. The relevant intermediaries fail to perform their duties and diligently practice, which seriously hinders the healthy development of the capital market. In this regard, the CSRC will always maintain a high-pressure situation, make full use of the responsibilities conferred by the law, comprehensively use the system of accountability for administrative punishment, criminal accountability, civil compensation, and integrity records to fight against financial fraud.
With the promulgation and implementation of the new "Securities Law" and the continuous advancement of capital market reforms, the cost of securities fraud and financial violations will increase substantially. After the administrative penalty decision is made, the relevant responsible units and personnel will also face civil litigation claims from investors and pay more High price. It is hoped that the majority of listed companies will take the precautions, stick to the bottom line of integrity, and relevant intermediary agencies will return to their responsibilities to jointly promote the healthy development of the market. The CSRC will also continue to strengthen investor protection, improve the quality of listed companies, consolidate the responsibilities of intermediaries, accurately supervise law enforcement, resolutely purify the market environment, and better play the role of the capital market in serving the real economy and investors.