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colluding with private equity professionals to manipulate stock prices is nothing new, and this time the private equity parties do not bear the main responsibility.

the china securities regulatory commission recently disclosed that the case of chen wei, then chairman of tianhong group, and qiu jianming, then general manager of yixinda, manipulating the stock of "suzhou longjie" has been investigated and handled. from february 21 to july 27, 2022, chen wei and qiu jianming actually controlled 90 securities accounts including "bao moulin" (hereinafter referred to as the account group involved in the case) through stock allocation and other means, and traded "suzhou longjie", which constituted market manipulation.

the penalty notice pointed out that chen wei and qiu jianming divided the work and cooperated with each other, and were joint offenders, bearing the main responsibility and the secondary responsibility respectively. the two requested a reduction in punishment, but the csrc did not accept it and finally decided: 1) to confiscate the illegal income of 9.7857 million yuan, chen wei and qiu jianming were responsible for 7.8286 million yuan and 1.9571 million yuan respectively; 2) to impose a fine of 29.3571 million yuan, chen wei and qiu jianming were responsible for 23.4857 million yuan and 5.8714 million yuan respectively; 3) due to the serious circumstances of the illegal acts, chen wei and qiu jianming were also banned from the market for 5 years and 3 years respectively. from the date of the announcement of the decision by the csrc, during the ban period, they shall not engage in securities business, securities service business or serve as directors, supervisors, or senior managers of the original securities issuers in any institution.

chen wei received a case filing notice issued by the china securities regulatory commission in june 2023 for suspected manipulation of the securities market. on the day of receiving the case filing notice, chen wei, the second largest shareholder of kehua holdings, resigned as a director of the company, and his original plan to seek the actual controller of the company was soon terminated.

it is worth noting that chen wei and several companies of tianhong group and wanxiang automobile were newly subject to execution in april this year, with the execution target of 436 million yuan. chen wei is the legal representative of many of these companies. in may this year, an illegal fundraising case that was heard in court involved wanxiang automobile and its chairman chen xuanlin, who was rumored to have run away.

how to control 90 accounts to manipulate stock prices?

based on multiple pieces of evidence, the china securities regulatory commission has confirmed the illegal acts of yu chenwei and qiu jianming.

from february 21 to july 27, 2022, chen wei and qiu jianming controlled and used the account group involved in the case, concentrated their financial advantages and shareholding advantages, and continuously traded "suzhou longjie" to manipulate "suzhou longjie". from february 21 to july 27, 2022, the account group involved in the case bought a total of 2.711 billion yuan and sold 2.709 billion yuan.

during the manipulation period, the total number of shares held by the account group involved in 92 trading days accounted for more than 5% of the total share capital, with the highest reaching 19.1%.

during the price-pushing phase (march 21 to july 15, 2022), the account group involved in the case submitted a large number of purchase bids at a price no lower than the market's highest selling price. the amount of such bids submitted by the account group accounted for 42.26% of the total bids submitted in the same direction by the account group during the period. the account group's trading volume during the same period accounted for 20.31% of the market's trading volume.

in addition, the account group involved in the case also carried out back-to-back transactions. during the manipulation period, "suzhou longjie" rose by 12.47%, while the shanghai composite index fell by 6.16% during the same period, with the former deviating from the latter by 18.63%. during the manipulation period, the account group involved in the case bought a total of 116 million shares and sold 121 million shares. the illegal income of the account group involved in the case was 9.7857 million yuan.

the csrc held a hearing at the request of the parties involved, chen wei and qiu jianming. the two stated that the five accounts of "wang mouyi", "liang mouyi", "wu mousui", "chen mou" and "pan mou" were not controlled and used by the parties involved. after deducting the losses of the aforementioned accounts, there was no illegal income in the account group in this case.

after reviewing the defense opinions of chen wei and qiu jianming, the csrc believes that the parties controlled and used the above-mentioned five accounts based on four grounds: first, the funds in the above-mentioned five accounts all came from chen wei's bank account; second, witness testimony, chat records and other evidence proved that the "wang mouyi" account was controlled and used by the party, the time of fund transfer and purchase was relatively consistent, the capital allocation characteristics were relatively obvious, and there was a convergence of transactions with other accounts in the account group; third, the "liang mouyi", "wu mousui", "chen mou" and "pan mou" accounts were associated with other accounts in the account group in terms of mac address, ip address, hard disk, etc.; fourth, the relevant person (li mou) pointed out that he controlled and used the "pan mou" account.

after the case was filed, chen wei lost his position as the actual controller of the listed company

as a shareholder holding more than 5% of kehua holdings and a former director, chen wei received a notice of filing on june 20, 2023 for suspected manipulation of the securities market, which was disclosed in a subsequent announcement. on that day, chen wei submitted his resignation report and stated that he applied to resign as a director of the company for personal reasons. on june 30 of that year, it was announced that chen wei also terminated the acquisition of control of the listed company.

originally, chen wei planned to gradually become the new actual controller of kehua holdings through the method of "equity transfer + fixed increase subscription". chen wei invested 300 million yuan to acquire 16.008 million shares held by chen hongmin and others. according to the announcement in july 2022, chen wei planned to subscribe for 40 million shares issued by the company ("issued to specific objects"), and after the issuance is completed, he will become the controlling shareholder and actual controller of kehua holdings.

however, with a notice of filing a case, chen wei's plan to become the actual controller of the listed company failed.

in april this year, tianhong group, chen wei and other new persons subject to execution were added, with the execution target of 436 million yuan. other persons subject to execution include taizhou wanxiang automobile manufacturing co., ltd. (referred to as wanxiang automobile), shanghai wanxiang automobile manufacturing co., ltd. (referred to as shanghai wanxiang automobile manufacturing), shanghai wanxiang automobile group co., ltd. (referred to as shanghai wanxiang automobile group), dongguan tianhong industrial co., ltd. (referred to as tianhong industrial), and tianhong holdings (suzhou) co., ltd. (referred to as tianhong holdings). in addition to wanxiang automobile, which has closed down, the legal representatives of the other five companies are all chen wei, but the six companies are deeply involved in equity relations.

after investigation, it was found that chen wei holds 99% of tianhong group, tianhong industry is wholly owned by tianhong group, and tianhong holdings is a wholly owned subsidiary of tianhong industry. the controlling shareholder of shanghai wanxiang automobile group is tianhong holdings, and xiamen emerging industry venture capital was newly added as an investor last year. in addition, shanghai wanxiang automobile manufacturing is held by shanghai wanxiang automobile group and aijian capital with 97.98% and 2.02% respectively. shanghai wanxiang automobile manufacturing is the largest shareholder of wanxiang automobile, and guangwei holdings also holds a stake in wanxiang automobile.

tianyancha shows that the above six companies were involved in many legal cases, especially shanghai vientiane automobile manufacturing and shanghai vientiane automobile manufacturing.

on may 10 and 11 this year, the illegal fund-raising case of shanghai beiguang investment management co., ltd. (hereinafter referred to as beiguang investment) was heard in court. more than 30 middle and senior executives, including the legal representative and actual controller, were charged with the crime of illegally absorbing public deposits. according to china news weekly, citing phoenix.com's "eye of the storm", part of the funds raised illegally flowed into aiways and vientiane. several other investors quoted statements made during their communication with the economic investigation department, saying that at the time of the incident, the amount of money not redeemed was more than 13 billion yuan, which flowed to vientiane, cci holdings, and aiways, with 6.3 billion yuan, 4.5 billion yuan, and 1.5 billion yuan respectively. so, will these three companies be held responsible for the above-mentioned illegal fund-raising case?

it is worth noting that chen xuanlin, the current chairman and actual controller of cci holdings, also serves as the chairman of vientiane automobile. according to media reports, several investors said that chen xuanlin had smuggled into the united states via hong kong, china in november 2022.

qiu jianming: the company in which we hold shares has been listed on the list of abnormal operations many times

according to the china securities association, yixinda is a private equity investment fund established in august 2014 and completed registration in january 2015. the registered and paid-in capital is 50 million yuan, the management scale ranges from 0 to 500 million yuan, and there are 5 registered full-time employees. currently, there are 1 product in operation and 1 product in early liquidation. in addition, zhou qingyou and qiu jianming hold 90% and 10% of the shares of this private equity respectively.

according to public information, part of zhou qingyou’s shares in yixinda were frozen in may this year for three years.

according to his resume, qiu jianming has served as the marketing director of citic securities suzhou suya road securities sales department for more than 8 years since june 1996. in august 2014, he began to serve as the legal representative, general manager, and person in charge of information reporting of yixinda.

tianyancha shows that yixinda was wholly owned by qiu jianming in the early days of its establishment, with a personal investment of 20 million yuan. later, zhou qingyou was added as an investor. the 2015 annual report pointed out that zhou qingyou and qiu jianming paid 45 million yuan and 5 million yuan respectively. in 2017, yixinda's business scope changed, and it no longer had industrial investment, but retained asset management and investment management.

qiu jianming's shareholding in huajian equity investment fund (suzhou) co., ltd. (hereinafter referred to as huajian investment) was revoked on june 22, 2020. as early as august 2019, huajian investment was listed in the list of seriously illegal and dishonest enterprises by the jiangsu provincial market supervision bureau because it had not fulfilled its relevant obligations after being included in the abnormal operation list for 3 years. from july 2016 to october 2019, it was included in the abnormal operation list 5 times by the suzhou industrial park market supervision bureau for reasons including failure to publicize the annual report within the prescribed period and inability to contact through the registered residence or business premises.

on september 2 this year, the suzhou industrial park people's court ruled in accordance with the law to accept qiu jianming's application for compulsory liquidation by huajian investment, and designated a law firm as the liquidation group in accordance with the law.

also, because qiu jianming's other shareholding company, suzhou yixin yida investment management enterprise (limited partnership), was included in the list of serious illegal and untrustworthy enterprises for the third time, it had not fulfilled relevant obligations after being included in the abnormal operation list for three years.

tianyancha shows that there are a total of 147 companies that share the same phone number with yixinda investment, and points out the suspected accounting agency phone number.