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Reporter: Zhao Yangge

Something happened to “China’s first listed university”?

After the market closed on August 5,Fudan Fuhua(600624.SH) disclosed that the company received a "Notice of Case Filing" from the China Securities Regulatory Commission. The China Securities Regulatory Commission filed a case against the company for suspected illegal and irregular information disclosure. Fudan Fuhua also stated that during the case filing period, it will actively cooperate with the China Securities Regulatory Commission's investigation and disclose information in a timely manner. At present, the company's production and operation are normal. The news also directly led to the "limit down" of Fudan Fuhua's stock price on August 6.

However, investors familiar with Fudan Fuhua may not be too surprised. Because in March of this year, Fudan Fuhua received the "Administrative Supervision Measures Decision" issued by the Shanghai Securities Regulatory Bureau. According to investigations, Fudan Fuhua borrowed a total of 75 million yuan from the company's construction contractor Shunjie Construction (Group) Co., Ltd. from 2013 to 2017 to solve the historical accounts of its shareholding companies Shanghai Hi-Tech Real Estate Development Co., Ltd. and Shanghai Fuhua Sino-Japanese Medical Health Industry Development Co., Ltd., and falsely settled the accounts. Among them, 20 million yuan of debt was confirmed by an effective judicial judgment in November 2023, and 55 million yuan was in litigation. In June 2023, Fudan Fuhua set aside 20 million yuan of estimated liabilities based on the first-instance judgment, and the full amount was recognized as a current loss.

The Shanghai Securities Regulatory Bureau stated that Fudan Fuhua’s concealment of liabilities, false balance of accounts, and improper accounting recognitionThe company's periodic financial reports for the period 2013-2023 disclosed false information., which violates the provisions of Article 2, paragraph 1 of the "Information Disclosure Management Measures for Listed Companies" (CSRC Order No. 40) and Article 3, paragraph 1 of the "Information Disclosure Management Measures for Listed Companies" (CSRC Order No. 182).

In accordance with Article 52, Item 1 of the "Administrative Measures for Information Disclosure of Listed Companies" (CSRC Order No. 182), the Shanghai Regulatory Bureau decided to take supervisory and management measures against Fudan Fuhua to order it to make corrections. Fudan Fuhua should strengthen its awareness of legal compliance, do a good job in information disclosure, and submit a written rectification report within 30 days from the date of receipt of the decision.

Fudan Fuhua is now facing a lawsuit due to its 10-year history of false records, which may be related to this.

"Shareholders can expect compensation," said Song Yixin, a lawyer at Shanghai Hanlian Law Firm. According to the Civil Code, the Securities Law, and the Supreme People's Court's judicial interpretation on civil compensation for false statements, the judicial interpretation on several issues concerning the registration and filing of cases by the people's courts, the judicial interpretation on representative litigation in securities disputes, the minutes of the National Court Civil and Commercial Trial Work Conference, the minutes of the National Court Symposium on the Trial of Bond Dispute Cases, the Several Opinions on Providing Judicial Guarantees for the Establishment of the Science and Technology Innovation Board and the Pilot Registration System Reform, and the Opinions on Providing Judicial Guarantees for the Establishment of the Science and Technology Innovation Board and the Pilot Registration System Reform.GEMAccording to the Several Opinions on Providing Judicial Guarantees for the Reform and Pilot Registration System, and the China Securities Regulatory Commission issued the Basic System Arrangements for the Beijing Stock Exchange, listed companies, controlling shareholders, actual controllers, directors, supervisors, and senior management personnel and their intermediary institutions, etc., shall bear civil liability for damages to the rights and interests of securities investors due to securities fraud such as false statements. The scope of compensation includes: investment difference, commission, stamp duty, and interest loss, etc. Securities investors whose rights and interests are damaged can file civil compensation lawsuits with courts with jurisdiction.

Since Fudan Fuhua was suspected of violating information disclosure laws and regulations, it was investigated by the China Securities Regulatory Commission. Securities investors whose rights and interests were damaged can register for claims. According to the guidance of lawyer Song Yixin, the conditions for claims in the Fudan Fuhua case are: Buy Fudan Fuhua shares before August 6, 2024 orBondsInvestors who have publicly issued products on securities markets such as , and sold or continued to hold them on or after August 6, 2024, can register for claims.Futures Contractsor Exchange Traded Funds (ETF) can also consult.