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recently, the website of the china securities regulatory commission disclosed three fines at one time.

zhao yuanjun, former head of the investment banking department of everbright securities, was punished for insider trading of "xingxing technology" (300256.sz). in addition, two former employees of xingxing technology were also fined for insider trading.

it is worth noting that as an insider of the major asset restructuring of xingxing technology, zhao yuanjun, then an investment bank employee of everbright securities, bought 11.4122 million yuan of xingxing technology in advance, but ultimately lost 5.3258 million yuan. the china securities regulatory commission imposed a total fine of 4.6 million yuan on zhao yuanjun in accordance with the law, and also banned him from the securities market for 10 years.

in response to this, everbright securities told the reporter of securities china that the company firmly supports the decision of the csrc to impose administrative penalties on the former employees of the company. it will strictly follow the provisions of the company's accountability system, seriously investigate the responsible persons, and learn from the incident to further carry out comprehensive self-examination and rectification. in the next step, the company will continue to improve the long-term control mechanism and promote the formation of a strict atmosphere with strict measures.

investment bank boss punished for insider trading

according to the administrative penalty decision released by the csrc, the party involved in the penalty, zhao yuanjun, worked at everbright securities from september 17, 2018 to february 28, 2022, and was a securities practitioner. in february 2020, zhao yuanjun violated the rules by engaging in insider trading during the reorganization of xingxing technology.

it is worth noting that public information shows that zhao yuanjun has many years of investment banking experience. during the period of the case, he served as the general manager of the investment banking headquarters of everbright securities and is a senior investment banker.

the insider trading process disclosed in the administrative penalty decision shows that on february 17, 2020, kang from everbright securities designed a major asset restructuring plan based on the situation of xingxing technology and financing rules. on february 19, 2020, kang reported the situation of this major asset restructuring project to zhao yuanjun. zhao yuanjun reported the relevant matters to the relevant person in charge of everbright securities and instructed kang to conduct a feasibility analysis of the restructuring project. on february 20, 2020, kang sent a relevant analysis report to zhao yuanjun. on february 22, 2020, zhao yuanjun participated in a video meeting with xingxing technology on the project.

on march 15, 2020, xingxing technology issued a major asset reorganization announcement. the regulator believes that the insider information was formed no later than february 22, 2020 and was made public on march 15, 2020. zhao yuanjun is an insider of the insider information and was aware of it no later than february 22, 2020.

the administrative penalty decision shows that zhao yuanjun used the securities account of "zhao moujiang" to buy a total of about 1.6 million shares of xingxing technology on february 25 and 28, 2020, with a transaction amount of about 11.4122 million yuan. on august 18 and 19, 2021, zhao yuanjun sold all his shares, with a transaction amount of about 6.0959 million yuan. after calculation, the above transaction loss was 5.3258 million yuan.

during the hearing, zhao yuanjun stated that the timing of the formation of the insider information involved in the case was wrong; he was unaware of the insider information involved in the case; he bought "xingxing technology" based on the recommendation of friends and personal research, and the transaction behavior involved in the case was not abnormal; the penalty was too heavy. the csrc stated that the evidence in the case was sufficient to prove that zhao yuanjun received the relevant major asset restructuring plan design on february 19, 2020, and participated in the relevant video meeting on february 22, and zhao yuanjun was a legal insider.

everbright securities responded: conduct comprehensive self-examination and rectification

finally, considering the facts, nature, circumstances and degree of social harm of zhao yuanjun's illegal acts, the csrc made a penalty decision: according to article 187 of the securities law, zhao yuanjun was fined rmb 4 million; according to article 202 of the securities law of 2005, zhao yuanjun was fined rmb 600,000. the two fines totaled rmb 4.6 million.

in addition, the csrc has taken measures to ban zhao yuanjun from the securities market for 10 years. during the ban period, in addition to not being allowed to continue to engage in securities business in the original institution or serve as a director, supervisor, or senior manager of the original listed company or non-listed public company, he is also not allowed to engage in securities business in any other institution or serve as a director, supervisor, or senior manager of other listed companies or non-listed public companies.

in response to this, everbright securities told the reporter of securities china that the company firmly supports the decision of the csrc to impose administrative penalties on the former employees of the company. it will strictly follow the provisions of the company's accountability system, seriously investigate the responsible persons, and learn from the incident to further carry out comprehensive self-examination and rectification.

everbright securities said that in recent years, the company has strictly implemented the securities law and related regulatory requirements, continued to strengthen the control of employees' professional behavior, and formed a supervisory force from compliance, internal audit, discipline inspection and other lines. through information reporting management, transaction behavior monitoring and verification, illegal behavior accountability, and strengthening warning case education, a comprehensive control mechanism has been formed. the company adheres to the principle of "zero tolerance" for employees' illegal and irregular professional behavior, and establishes an accountability system to strengthen accountability. in the next step, the company will continue to improve the long-term control mechanism and promote the comprehensive formation of a strict atmosphere with strict measures.

two former employees of the listed company were also fined

in addition, the csrc also disclosed two fines involving former employees of star technology. in august 2021, star technology planned to correct errors in its 2020 financial data, and its net profit turned from positive to negative. these two former employees, as insiders of the insider information, engaged in insider trading and made profits.

among them, wang xianyu, a former senior manager of xingxing technology, was an insider. from august 4 to august 12, 2021, wang xianyu controlled and used his own account to sell a total of about 1.351 million shares of "xingxing technology", with a transaction amount of about 7.4409 million yuan. after calculation, the account avoided a total loss of about 4.2204 million yuan.

the csrc decided to confiscate wang xianyu's illegal gains of 4.2204 million yuan and impose a fine of 12.6613 million yuan. in other words, wang xianyu not only had his illegal gains confiscated, but was also fined three times as much for insider trading. at the same time, the csrc banned wang xianyu from the securities market for five years. during the ban period, in addition to not being allowed to continue to engage in securities business or securities service business in the original institution or serve as a director, supervisor, or senior manager of the original securities issuer, he is also not allowed to engage in securities business or securities service business in any other institution or serve as a director, supervisor, or senior manager of other securities issuers.

zhang wenduo was the assistant to the president of xingxing technology at the time, assisting the chairman in supervising the production and operation of each subsidiary. from july 8 to 15, 2021, zhang wenduo controlled and used his own securities account to sell a total of 137,000 shares of "xingxing technology" with a transaction amount of 779,600 yuan. after calculation, the account avoided a total loss of 453,000 yuan.

the csrc decided to confiscate zhang wenduo’s illegal gains of 453,000 yuan and impose a fine of 600,000 yuan.