Administrative penalty decision of the Beijing Supervision Bureau of the China ** Supervision and Administration Commission (Hibiscus Capital, Xu Jingjing).
Parties: Hibiscus Capital Investment Management *** hereinafter referred to as Hibiscus Capital), domicile: Dongcheng District, Beijing.
Xu Jingjing, female, born in August 1985, was the chairman and legal representative of Hibiscus Capital, address: Dongcheng District, Beijing.
In accordance with the relevant provisions of the ** Law of the People's Republic of China revised in 2005 (hereinafter referred to as the "** Law of 2005"), our bureau conducted an investigation and trial on the insider trading of the parties' Minsheng Holding shares, and informed the parties of the facts, reasons, basis and rights enjoyed by the parties in accordance with the law. At the request of the parties Hongjin Capital and Xu Jingjing, our bureau held a hearing and listened to the statements and defenses of the parties and their ** people. The investigation and trial of this case have now been concluded.
After investigation, the parties have the following illegal facts:
1. The process of formation and disclosure of inside information
In 2015, Minsheng Holdings further clarified its future development strategy, built an investment holding platform that "combines financial services and scientific and technological innovation business", and built the company into a listed enterprise with both small, medium and micro financial services and scientific and technological innovation business characteristics.
At the beginning of 2015, Minsheng Holdings decided to first acquire a non-financial company under China Oceanwide Holdings Group, hereinafter referred to as China Oceanwide, and then transfer other assets, and then transfer the assets as the main business, and intends to constitute a backdoor listing.
In May 2015, Minsheng Holdings acquired 100% equity of Minsheng Wealth Investment Management, a subsidiary of China Oceanwide. After the acquisition of Minsheng Wealth, Minsheng Holdings transformed into a listed company with small and medium-sized financial services including pawnbroking, insurance brokerage and wealth management.
In August 2015, Minsheng Holdings announced the acquisition of Shenzhen Oceanwide Sanjiang Electronics Co., Ltd. of China Oceanwide Holdings, hereinafter referred to as Sanjiang Electronics), if the acquisition is successful, it will realize the strategy of Minsheng Holdings to develop in the direction of scientific and technological innovation business.
On January 22, 2016, the China Securities Regulatory Commission made the "Decision on Not Approving the Major Asset Restructuring of Minsheng Holdings" (Zheng Jian Xu Xu 2016 No. 121), and the failure of the acquisition plan of Sanjiang Electronics led to the failure of the development strategy of Minsheng Holdings and the main purpose of acquiring Minsheng Wealth.
In the first quarter of 2016, Minsheng Wealth's performance was at a loss, and Minsheng Wealth's profit target for 2016 was 40 million. Wang Mou, chairman of Minsheng Holdings, was also the chairman of Minsheng Wealth at that time, and personally grasped the operation of Minsheng Wealth, and Wang was more optimistic about the prospects of Minsheng Wealth and hoped to turn losses into profits.
In March 2016, Ma, the former president of Minsheng Wealth, proposed to resign, and Wang took over the operation and management of Minsheng Wealth. In May 2016, after Mr. Ma resigned, Mr. Wang concurrently served as the president and chairman of Minsheng Wealth.
Qu Mouming, the financial director of Minsheng Wealth, will report the company's performance of the month around the day every month, and the results are not much different from the actual results. In the second quarter of 2016, Minsheng wealth continued to lose, and the amount of loss continued to increase. No later than June 26, 2016, Qu Mouming had made a performance loss for Minsheng Fortune in the second quarter** and reported it orally to Wang. Chen Moudong, chief financial officer of Minsheng Holdings, also measured the performance of Minsheng Holdings including Minsheng Wealth at the end of June.
At the beginning of July 2016, after asking Chen Moudong about the loss of Minsheng Wealth, Chen Mouhua, President of Minsheng Holdings, proposed to Wang to transfer Minsheng Wealth, on the grounds that the loss of Minsheng Wealth was serious, far less than the profit target set at the beginning of 2016, and the overall performance of the listed company was greatly dragged down.
On August 20, 2016, the 2016 semi-annual report of Minsheng Holdings was basically completed, and Chen Mouhua and Wang discussed the transfer of Minsheng wealth.
On September 1, 2016, the management of Minsheng Holdings held a meeting to discuss the matters of Minsheng Wealth, and unanimously agreed to give China Oceanwide Minsheng Wealth equity. There are two main reasons for the transfer of people's livelihood wealth: one is that people's livelihood wealth has been losing money, and the other is that the regulatory policies of the industry where people's livelihood wealth is located have become tighter.
On September 2, 2016, Wang and Chen Mouhua reported to Li Mouhai, the leader in charge of China Oceanwide, who believed that it was feasible and needed to ask Chairman Lu Mouqiang for instructions, but had asked Minsheng Holdings to handle the relevant preparations for assets first. On the same day, the management of Minsheng Holdings convened the Finance Department, the Board Supervision Office and other departments of Minsheng Holdings, as well as the personnel of the Finance Department and the Risk Control Department of Minsheng Wealth to discuss and arrange the best matters of Minsheng Wealth.
On September 7, 2016, financial consultants and audit institutions conducted preliminary communication with Minsheng Holdings and Minsheng Wealth to study the follow-up plan.
On September 8, 2016, Li Mouhai convened the Executive Committee of China Oceanwide to discuss the transfer of Minsheng Wealth by Minsheng Holdings, and everyone unanimously agreed and determined that it should be acquired by China Oceanwide.
On September 14, 2016, Li Mouhai reported to Lu Mouqiang about the transfer of Minsheng wealth by Minsheng Holdings, and Lu Mouqiang agreed. On September 18, 2016, China Oceanwide held a board meeting by way of subpoena to consider and approve the acquisition of 100% equity of Minsheng Wealth from Minsheng Holdings.
On September 30, 2016, Minsheng Holdings issued a temporary suspension announcement, saying that it was planning to disclose major matters.
On October 18, 2016, Minsheng Holdings issued an announcement confirming that the planned major events constituted a major asset restructuring.
On October 27, 2016, Minsheng Holdings announced that it intends to pay 100% of the equity of Minsheng Wealth held by the listed company to China Oceanwide for 350 million yuan, and China Oceanwide will pay the consideration in RMB cash. After the completion of this transaction, Minsheng Holdings will divest its wealth management business.
On November 2, 2016, Minsheng Holding Co., Ltd. resumed trading.
Minsheng Holdings' proposed transfer of Minsheng Wealth and divestment of wealth management business are insider information as stipulated in Item 5, Paragraph 2 of Article 75 of the ** Law of 2005 before public disclosure. Inside information was formed on June 26, 2016 and made public on October 27, 2016 (hereinafter referred to as the "Sensitive Period of Inside Information"). Wang, as the director and deputy general manager of China Oceanwide, the chairman of Minsheng Holdings, and the chairman and president of Minsheng Wealth, is the decision-maker and leading person of Minsheng Holdings, and is an insider of this case.
During the sensitive period of inside information, Luan Mouzhou made a phone call with Wang, an insider of inside information in this case, on June 28, 2016, and Luan Mouzhou operated a large number of **accounts under the names of Peng Mouhui and Shi Moujia on the next day** "Minsheng Holdings", and his trading behavior was highly consistent with the inside information in this case, and the relevant trading behavior was obviously abnormal, without proper information** or reasonable explanation, constituting insider trading, and he was the person who illegally obtained inside information in this case (which has been dealt with separately).
2. The insider trading of "Minsheng Holdings" by Hibiscus Capital
(1) During the sensitive period of inside information, the senior management of Honghibiscus Capital and its shareholders had telephone contact with Luan Mouzhou, the person who illegally obtained the inside information in this case, and Wang, the insider of the inside information
Purple Stone Capital Investment Management *** hereinafter referred to as Purple Stone Capital) holds 100% of Red Hibiscus Capital. During the period involved in the case, Xu Jingjing was the chairman and legal representative of Zishi Capital and Honghibiscus Capital, and Liu Mouyong was the general manager of Zishi Capital. Xu Jingjing and Liu Mouyong are both senior managers of Hibiscus Capital and Zishi Capital, and they have a close working relationship.
Purple Stone Capital and Red Hibiscus Capital have close relationships with China Oceanwide. The office addresses of Zishi Capital and Hibiscus Capital are both leased properties of China Oceanwide, and are in the same office buildings as China Oceanwide and Minsheng Holdings. Liu Mouyong, the general manager of Zishi Capital, was originally an employee of China Oceanwide, the former director or senior management of Zishi Capital, Kao Mouxiao, and Yang were the former employees of China Oceanwide, and Xu Moubing, the former independent director of Zishi Capital, was a director and vice president of China Oceanwide. Before 2016, the industrial and commercial registration procedures of Zishi Capital were handled by Shu and Han, employees of China Oceanwide.
Lu Mouqiang, chairman of China Oceanwide, and Luan Mouzhou, former secretary, are the contact person between Zishi Capital and China Oceanwide. During the sensitive period of inside information, from July 2016 to September 2016, Xu Jingjing and Luan Mouzhou made several phone calls.
Liu Mouyong and Wang, an insider of the inside information in this case, worked together in China Oceanwide and knew each other for a long time. On July 19, 2016, Liu Mouyong and Wang were in contact by phone.
(2) The use of the company's ** account by Hibiscus Capital to trade "Minsheng Holdings".
On January 12, 2016, the "Red Hibiscus Capital" account was opened in the business department of Haitong ** Guanghua Road, Beijing. The actual operator of the "Hibiscus Capital" account is Chen, a trader of Hibiscus Capital, Xu Jingjing and Liu Mouyong jointly made the decision to transfer funds, Xu Jingjing made the decision to trade "Minsheng Holdings", and Liu Mouyong participated in the discussion and participated in the decision to trade "Minsheng Holdings". Xu Jingjing made specific trading instructions, and Xu Jingjing issued trading instructions to Chen every day, generally through oral or ** instructions for trading; Chen reported the transaction to Xu Jingjing at any time. The transaction method is operated by the computer of Red Hibiscus Capital, and the transaction address is the IP address of Red Hibiscus Capital.
From July 6, 2016 to the suspension of trading of "Minsheng Holdings", the account of "Honghibiscus Capital" continued to ** "Minsheng Holdings", totaling 2,268 "Minsheng Holdings".280,000 shares, ** amount 18,894950,000 yuan, a profit of 44,831,57441 yuan.
(3) During the sensitive period of inside information, the behavior of Hongjin Capital's transaction of "Minsheng Holdings" was obviously abnormal and there was no reasonable explanation
The "Hibiscus Capital" account has not been transferred since it was opened. On April 26, 2016, 500,000 yuan was transferred, and 5,000 shares of ** "Oceanwide Holdings" were transferred on the same day, and there was no other operation.
On the evening of July 4, 2016, Xu Jingjing called Luan Mouzhou to talk, and on July 6, Zishi Capital transferred 200 million yuan of registered capital to Honghibiscus Capital. The funds were transferred to the account of "Honghibiscus Capital" on the same day, and the first, large and centralized trading of "Minsheng Holdings" began on the same day, with 2.08 million shares of "Minsheng Holdings" on the same day, with strong willingness and obvious abnormal trading behavior.
On July 7, 2016, after Xu Jingjing called Luan Mouzhou, the "Red Hibiscus Capital" account ** "Minsheng Holdings" 18310,000 shares.
On July 13, 2016, after Xu Jingjing called Luan Mouzhou, the "Red Hibiscus Capital" account **209130,000 shares.
In July 2016, Xu Jingjing called Luan Mouzhou on the phone, and on that day, the "Hongjin Capital" account was ** "Minsheng Holdings" with millions of shares.
On July 19, 2016, Liu Mouyong and Wang contacted by phone, and on July 21, the number of "Minsheng Holdings" in the "Hongjin Capital" account exceeded 2 million shares for 4 consecutive trading days, and a large number of ** "Minsheng shares" had a strong will, and the trading behavior was obviously abnormal.
The transaction of "Minsheng Holdings" by Hibiscus Capital is highly consistent with the inside information and the telephone contact between Xu Jingjing and Liu Mouyong, senior managers of Red Hibiscus Capital and its shareholders, and Luan Mouzhou, who illegally obtained inside information, and Wang, an insider of inside information, and the transaction behavior is obviously abnormal. Hibiscus Capital, Zishi Capital, Xu Jingjing and Liu Mouyong have no reasonable explanation or legitimate information about this**.
The above facts are supported by evidence such as relevant announcements, ** account information, ** account transaction records, bank account information, interrogation records, and explanations, which are sufficient to determine.
During the sensitive period of inside information, the senior management of Red Hibiscus Capital and its shareholders contacted Wang Mouzhou, an insider of inside information, and Luan Mouzhou, a person who illegally obtained inside information, and the relevant senior management personnel discussed and made trading decisions, and the trading activities of Red Hibiscus Capital were highly consistent with the inside information, and the relevant trading behaviors were obviously abnormal, and there was no legitimate information** or reasonable explanation, and Red Hibiscus Capital violated the provisions of Article 73 and Article 76, Paragraph 1 of the 2005 ** Law, which constituted the ** Law of 2005 Insider trading violations under Article 202.
Xu Jingjing, as the chairman and legal representative of Hibiscus Capital, made decisions, organized and carried out the illegal insider trading involved in the case, and was the person in charge directly responsible for the illegal insider trading of Red Hibiscus Capital.
In the hearing and statement and defense, Hongjin Capital, Xu Jingjing and their ** people put forward that: first, the determination of the time of the formation of inside information obviously lacked basis, and the time when Wang knew the performance loss could not be used as a sign of the formation of inside information; Second, during the sensitive period, Hibiscus Capital did not obtain the inside information involved in the case; Third, the transaction was carried out in accordance with the pre-established instruction plan, the transaction was justified and sufficient, and the transaction behavior did not conform to the typical characteristics of insider trading; Fourth, Hibiscus Capital has been holding Minsheng Holdings** for a long time, and the "profit amount" determined is only a floating profit on the books, which is far from the actual loss, and should not be punished on this basis. Fifth, Xu Jingjing, as the directly responsible person, should not be punished in a range higher than the punishment range of the unit's main responsibility, and the punishment for the unit is in the middle, and the punishment for the responsible personnel is not in line with the principle of proportionality of punishment. In summary, the transactions involved in the case did not constitute insider trading and should not be punished.
After review, our bureau believes that:
First, the inside information in this case was formed no later than June 26, 2016, which was the initial time of the motion, planning or decision-making of Minsheng Holdings' transfer of Minsheng Wealth. At the beginning of January 2016, the management of Minsheng Holdings had discussed the transfer of Minsheng Wealth. No later than June 26, 2016, Qu Mouming made a semi-annual performance**, and the cumulative loss of Minsheng Wealth in the first half year was nearly 30 million, and reported to Wang. Wang, as the chairman of Minsheng Holdings and Minsheng Wealth, has the right to decide on the transfer, and the significant losses of Minsheng Wealth in the first half of the year are enough to prompt him to form a judgment. At this time, it is the initial time of the major event motion, which is in line with the normal logic of divesting major loss-making assets to avoid dragging down the financial report of the listed company for the current year, and the inside information is formed.
Second, during the sensitive period, Xu Jingjing and Liu Mouyong, senior managers of Hibiscus Capital and its shareholder Zishi Capital, had multiple phone calls with Wang Mou, an insider of inside information, and Luan Mouzhou, a person who illegally obtained inside information. Xu Jingjing and Liu Mouyong, as senior managers of Hibiscus Capital and its shareholders, discussed and made transaction decisions, which is sufficient to determine that Hibiscus Capital used inside information to engage in the transactions involved in the case. The parties' arguments that they did not obtain inside information at the time of the transaction were insufficient.
Third, Hibiscus Capital's investment behavior was inconsistent with the plan, and the investment was not executed in accordance with the investment plan. The transaction involved in the case was not based on an established investment plan and instructions, which was insufficient to prove that the relevant transaction was not related to inside information. At the same time, during the sensitive period of inside information, the "Red Hibiscus Capital" account had abnormal transaction characteristics such as the sudden transfer of huge funds, and the first concentration of a large number of ** "Minsheng Holdings" single **, and the trading behavior was highly consistent with the inside information and the telephone contact between Xu Jingjing and Luan Mouzhou, Liu Mouyong and Wang, and the relevant senior management personnel discussed and made trading decisions, and the trading behavior was obviously abnormal. There is neither a legitimate reason nor a reasonable explanation for the abnormal characteristics of the transactions during the sensitive period, which is sufficient to determine that the transactions involved in the case of the parties have the abnormal characteristics of insider trading.
Fourth, the calculation of the illegal gains in this case was correct, and the subsequent losses of the account involved in the case were caused by stock price fluctuations, and there was no causal relationship with the illegal acts involved in the case.
Fifth, the responsibility of the responsible personnel is not only attached to the responsibility of the unit, but also has a certain degree of independence. Xu Jingjing, as the chairman and legal representative of Hibiscus Capital, made decisions, organized, and carried out the illegal acts of insider trading involved in the case, and was the person in charge directly responsible for the case, and played a major role in the illegal acts of the unit.
To sum up, our bureau does not adopt the defense opinions of Hibiscus Capital, Xu Jingjing and their ** people.
According to the facts, nature, circumstances and degree of social harm of the parties' illegal acts, and in accordance with the provisions of Article 202 of the ** Law of 2005, our bureau decides:
1. Order Hibiscus Capital to dispose of the illegally held ** in accordance with the law, and confiscate the illegal gains of 44,831,57441 yuan, and a fine of 89,663,148a fine of $81;
2. A fine of 300,000 yuan shall be imposed on Xu Jingjing, the person in charge who is directly responsible.
The above-mentioned parties shall, within 15 days from the date of receipt of this penalty decision, remit the fines and confiscated funds to the opening bank of the China ** Supervision and Administration Commission: Business Department of China CITIC Bank Beijing Branch, account number: 7111010189800000162, and the bank shall directly hand over to the state treasury, and send a copy of the payment voucher with the name of the party to the Office of the Administrative Punishment Committee of the China ** Supervision and Administration Commission and the Beijing Securities Regulatory Bureau for the record. If the parties are dissatisfied with this penalty decision, they may apply to the China ** Supervision and Administration Commission for administrative reconsideration within 60 days from the date of receipt of this penalty decision, and may also directly file an administrative lawsuit with the people's court with jurisdiction within 6 months from the date of receipt of this penalty decision. During the period of reconsideration and litigation, the implementation of the above decision shall not be suspended.
Beijing Regulatory Bureau of the China Securities Regulatory Commission
December 29, 2023