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recently, the china securities regulatory commission announced an administrative penalty decision, imposing a fine of nearly 167 million yuan on the illegal behavior of manipulating the securities market by natural person yi wei.

it is reported that during the period of his manipulation of jinling sports, the stock price doubled, and one trading day after the shipment was completed, the stock price of jinling sports began to fall rapidly, with a drop of more than 20% in ten trading days.

manipulating 39 accounts to trade jinling sports and illegally making over 80 million yuan in profits was severely punished

according to the administrative penalty decision,september 4, 2017 - april 18, 2019(hereinafter referred to as the "manipulation period"), yi wei controlled the use of 39 securities accounts to trade "jinling sports" stocks.

during the manipulation period, yi wei took advantage of his funds and shareholdings, and adopted methods such as continuous buying and selling, false declarations and back-to-back transactions to control and use groups of accounts, affecting the trading price and volume of "jinling sports" stocks and making a profit of 83.3422 million yuan.

yi wei's actions were eventually identified by the china securities regulatory commission as market manipulation, and the csrc adopted a "one-for-one fine" penalty measure against him, namely,the illegal gains of 83.3422 million yuan were confiscated and a fine of the same amount was imposed, with a total fine and confiscation of nearly 167 million yuan.

taking advantage of financial and shareholding advantages to continuously buy and sell back-to-back transactions and make false declarations

in terms of specific manipulation techniques,yi wei concentrated his financial and shareholding advantages to buy and sell continuously.during the manipulation period, a total of 394 trading days, the account group controlled by yi wei participated in transactions on 389 trading days. the period from september 4, 2017 to october 23, 2018 was the period of building positions and raising prices, and the period from october 24, 2018 to april 18, 2019 was the period of shipping.

the account group collectively bought 39.4243 million shares of "jinling sports" through bidding, with a total amount of 1.549 billion yuan. among them, the market share of buying volume exceeded 10% on 240 trading days, exceeded 20% on 141 trading days, exceeded 30% on 64 trading days, and exceeded 40% on 29 trading days; the market share of buying volume on 241 trading days ranked first.

the account group sold 38.0108 million shares of "jinling sports" through auction, with a total amount of 1.555 billion yuan. among them, the market share of sales volume exceeded 10% on 224 trading days, exceeded 20% on 116 trading days, exceeded 30% on 56 trading days, and exceeded 40% on 23 trading days; the sales volume ranked first on 227 trading days.

from september 4, 2017 to april 18, 2019, the account group's shareholding ratio in the circulating shares was above 5% for 160 trading days, and the highest shareholding ratio reached 8.57% on october 23, 2018. in summary, the csrc determined that the account group had advantages in funds and shareholding.

in addition, it conducted securities transactions between accounts that it actually controlled.during the manipulation period, the account group controlled by yi wei traded between accounts under his actual control on 277 trading days; among them, the arbitrage volume accounted for more than 10% of the market turnover on 69 trading days, more than 20% on 13 trading days, and more than 30% on 5 trading days; the arbitrage accounted for the highest proportion on december 5, 2018, reaching 34.29%.

another behavior is false declaration.during the manipulation period, the account group controlled by yi made false declarations on a total of 6 trading days, with the buying volume accounting for more than 30% of the same-direction declarations in the market during the same period, and the order cancellation volume accounting for more than 50% of the total same-direction declarations of the account group.

from doubling its share price to plummeting by 20%, jinling sports' share price once fluctuated violently

during yi wei's market manipulation, jinling sports' stock price experienced significant fluctuations. the stock price rose from an opening price of 18.16 yuan on september 4, 2017 to a closing price of 39.29 yuan on april 18, 2019, a cumulative increase of 116.7%, and the stock price doubled.

by counting the periods of lifting (the red frame interval in the above figure) and the periods of delivery (the blue frame interval in the above figure) during the manipulation period, we can see that in the initial stage of building positions, the stock price of jinling sports showed a volatile upward trend, but the increase was relatively mild.

however, when entering the delivery phase, jinling sports' stock price suddenly rose sharply. after reaching the price peak and completing the delivery, the stock price suffered a sharp drop in a short period of time, with a drop of 22.57% in 10 trading days.

has the manipulative behavior exceeded the two-year administrative penalty period? the china securities regulatory commission responded

it is worth mentioning that during the hearing, yi wei and his agent also raised objections, involving the legality of the transaction, the criteria for identifying market manipulation, and the statute of limitations for administrative penalties for market manipulation.and request no punishment or a lighter punishment.

they said that, first, yi wei traded "jinling sports" stocks for legitimate investment purposes, did not seek illegal profits, and did not have the subjective intention to manipulate the securities market, which did not constitute market manipulation. second, there was a lack of standards for determining the manipulation of the securities market, and the results of the determination were wrong. third, the determination of the manipulation period and the end date of the manipulation were wrong. fourth, there was a lack of evidence for the determination of the scope of the controlled accounts and the control period. fifth, there was insufficient evidence to determine that the trading behavior involved in the case had produced harmful results.sixth, the manipulative behavior has exceeded the two-year administrative penalty period.seventh, the calculation result of the amount of illegal income is wrong.

in response to this, the csrc responded one by one.

first, yi wei not only controlled and used his own securities accounts and the securities accounts of the products he managed, but also borrowed other people's securities accounts and used a combination of three manipulation techniques to repeatedly and massively trade "jinling sports" during the period of the case, which was sufficient to prove that he had the intention to manipulate the stock price. how to distribute the illegal proceeds does not affect the determination of the behavior of manipulating the securities market.

second, i will investigate and punish illegal activities of manipulating the securities market in accordance with the securities law of 2005 and refer to the interpretation of the supreme people's court and the supreme people's procuratorate on several issues concerning the application of law in handling criminal cases of manipulating the securities and futures markets, which is legally justified.

third, the facts of determining the scope of the controlled accounts and the control period are clear and the evidence is sufficient.

fourth, the manipulation period and the end date of the manipulation behavior are determined correctly.

fifth, yi wei's manipulation had a significant impact on the price of "jinling sports". during the period of the case, the stock price of "jinling sports" rose by 112.13%, while the corresponding sector index fell by 13.15%, with a deviation of 125.27%. the impact of other market factors on stock prices cannot be used as a reason to exclude yi wei's behavior from manipulating the securities market.

sixth, yi wei's manipulation of "jinling sports" ended on april 18, 2019. the relevant evidence is sufficient to prove that the time when i discovered the illegal clues in this case did not exceed the statute of limitations.

seventh, the calculation results of illegal gains are correct, and the opinions of the parties have been partially adopted.