Comey Pharmaceuticals' finance director was heavily fined

August 16, the Securities and Futures Commission released its findings on Comey Pharmaceuticals.The Chief Financial Officer fined 250,000 and banned the industry for 10 yearsthe CSRC found that Kangmei Pharmaceuticals' 2016 Annual Report inflated monetary funds by 22.58 billion yuan, accounting for 41.13 percent of the company's total assets disclosed and 76.74 percent of its net assets; The capital amounted to 29.94 billion yuan, accounting for 43.57 percent of the total assets disclosed by the Company and 93.18 percent of the net assets disclosed, and the 2018 Half Annual Report inflated the monetary funds by 36.19 billion yuan, accounting for 45.96 percent of the total assets disclosed by the Company and 108.24 percent of the net assets.The SFC has now dealt with Kangmei Pharmaceutical Co., Ltd. and its responsible personnel: 1. Ordered to correct, warned and fined 600,000 yuan;II, Ma Xingtian, Xu Dongxuan was given a warning, and was fined 900,000 yuan, of which 300,000 yuan as a direct responsible supervisor and600,000 yuan as the actual controller; . Warnings were given to Zhuang Yiqing (Finance Director, annual salary of 480,000), Wen Shaosheng (deputy general manager, annual salary of 590,000 yuan), Ma Huanzhou (supervisor, annual salary of 170,000 yuan) and fined 250,000 yuan respectively Lin Guoxiong (above, a leading executive with an annual salary of 180,000 to 710,000 and a market capitalisation of about 2 million to 20 million last year) was warned and fined 200,000 yuan each; 6. A warning was given to Zhang Hong, Guo Chonghui, Zhang Ping, Li Jianhua, Han Zhongwei and Wang Min (mainly independent directors with an annual salary of70,000 yuan) and fined 150,000 yuan respectively;In addition, the CSRC has adopted lifetime securities market bans on Ma Xingtian, Xu Dongxuan and Qiu Xiwei. To Zhuang Yiqing, Wen Shaosheng, Ma Huanzhou to take 10 years of securities market ban measures.Specifically, there are several major points:First, imitation, transformation of VAT invoices and other ways to inflate operating income between 2016 and 2018, Kangmei Pharmaceuticals is suspected of falsifying, changing VAT invoices and other ways to inflate operating income, through counterfeiting, transformation of large periodic deposit slips and other ways to inflate monetary funds, will not meet accounting confirmation and measurement conditions of engineering projects into the report, false increase in fixed assets. At the same time, Kangmei Pharmaceuticals is suspected of not disclosing the non-operational occupation of funds by controlling shareholders and related parties in the relevant annual reports. These actions resulted in false records and material omissions in the relevant annual reports disclosed by Comey Pharmaceuticals.Second, long-term, systematic implementation of financial fraud Kangmei Pharmaceuticals has a premeditated, organized, long-term, systematic implementation of financial fraud, malicious deception of investors, the impact is extremely bad, the consequences are particularly serious.Third, six parties to take the securities market ban measures the CSRC has served the parties involved in the case in advance notice, in accordance with the law to Kangmei Pharmaceuticals and Ma Xingtian and other 22 parties to be administratively punished, and six parties to take the securities market ban measures.Fourth, transfer to the judicial organs to investigate criminal responsibility the CSRC will fully listen to the parties' statements and arguments, adhere to the rule of law, professional principles, speed up the progress of handling cases, make full use of existing means, and strictly punish according to law. Those suspected of crimes shall be transferred to judicial organs for criminal responsibility in strict accordance with the relevant provisions.Fifth, to promote listed companies and major shareholders to tell the truth, make real accounts The CSRC will continue to maintain a high-pressure situation on information disclosure violations, increase disciplinary efforts, enhance supervision and deterrent power, will comprehensively use administrative penalties, criminal accountability, civil compensation and integrity records and other three-dimensional accountability system, enhance the cost of violations of the law, through continuous and accurate supervision, to promote listed companies and large shareholders to tell the truth, make real accounts, promote the intermediary to the right to live.The same is the financial
why Kangmei Pharmaceuticals does not withdraw from the market?Many people see such punishments, it is difficult to understand! Inflating such a large amount of money, but in the end it's just a fine?Also financial fraud, why should Kandessing face de-marketing?Condes new four-year inflated profits of 11.9 billion, was also fined 600,000, the market banned. However, because the actual profit is negative, Condes new will be de-marketed, the current suspension time of more than a month.According to the relevant provisions of the Securities Law, Kangmei Pharmaceuticals inflated operating profit by about 4.1 billion yuan, after deducting the inflated portion, in the last three years for 3.3 billion yuan, 1.635 billion yuan, 1.194 billion yuan, in accordance with the current provisions, does not meet the conditions for de-marketing. Comey Pharmaceuticals is not yet satisfied with the conditions for consecutive losses, therefore, it has not been de-marketed!Although the risk of forced de-marketing is temporarily lifted, the risks faced by Comey Pharmaceuticals have not been completely eliminated!First, Kangmei Pharmaceuticals will face large-scale investor claims as mentioned above, 600,000 yuan is the top penalty in the field of securities law, but this does not represent all legal liability, followed by criminal and civil legal liability. Criminal legal liability refers to the criminal responsibility that may also be suspected of a crime and transferred to the public security organs for investigation. Civil liability refers to the loss that may be caused to the shareholders, the shareholders can file a claim, this amount may be unlimited.At present, Comey Pharmaceuticals' financial fraud situation is out of the water, investors are also actively preparing litigation, Comey Pharmaceuticals will face a large-scale claims. If the claim down, Comey Pharmaceuticals in the future is facing the biggest compensation problem caused by the broken capital chain!Second, the risk of de-marketing has not been eliminated although the risk of administrative punishment of Kangmei Pharmaceuticals was lifted, but if the criminal investigation involved, and was found guilty of illegal acts, then it may still be de-marketed. From the point of view of fraud, has been a major violation of the law, the probability of forced de-market is still relatively large.The CSRC has also publicly stated that companies such as Kangmei Pharmaceuticals acted recklessly, without fear of the rule of law, in awe of investors, lost the bottom line of integrity, touched the red line of the rule of law, and shaken the foundation of the information disclosure system of listed companies. For Kangmei Pharmaceuticals involved in the case of the parties involved in the crime, in strict accordance with the relevant provisions transferred to the judicial organs to investigate criminal responsibility.The finance director was dumpedaccounting of Kangmei Pharmaceuticals, miserable!The CSRC's announcement clearly states that those suspected of crimes shall be transferred to judicial organs for criminal responsibility in strict accordance with the relevant provisions.In its 2018 annual report, Kangmei Pharmaceuticals falsely recorded a total of 3.6 billion yuan in inflated fixed assets, construction projects under construction and investment real estate. It also inflated monetary funds amounting to 22.549 billion yuan, 29.944 billion yuan and 36.188 billion yuan, respectively, through financial non-bookkeeping, false accounting, forgery and change of large periodic deposit slips or bank statements, in conjunction with fraudulent sales returns of operating income, amounting to a total of 88.681 billion yuan.According to Commy Pharmaceuticals' accounting data, Comey Pharmaceuticals called the 2017 annual report a "child's play".In terms of the reduction, 34.2 billion yuan of monetary funds decreased by 29.944 billion yuan, leaving only 4.2 billion yuan, operating income decreased by about 8.9 billion yuan from 26.5 billion yuan to 17.6 billion yuan, and operating costs decreased by 7.66 billion yuan from 18.5 billion yuan.As regards the increase, inventories increased by $19.5 billion from $15.7 billion to $35.2 billion, while other receivables increased from $180 million to $5.89 billion, an increase of $5.71 billion.Any adjustment is billions, even tens of billions. It's also hard for any CFO.Financial data "big change face", Kangmei Pharmaceuticals Chairman Ma Xingtian in a 1075-word "letter to all shareholders of Kangmei Pharmaceuticals" explained, summed up in 15 words: inadequate internal controls, financial management is not perfect. Financial management is not perfect, CFO Zhuangyi can not get rid of the relationship. Zhuang Yiqing is the "old man" of Kangmei Pharmaceuticals, has 18 years of service in the company, from the finance department accounting, finance director all the way to become finance director. From 2012 to 2017, Zhuang Yiqing's salary has been hovering around 370,000 yuan. In 2018, the company gave it a raise of 110,000 yuan. How much was Comey's finance director and financial staff involved in this incident? This is not good to say, however, if criminal responsibility is to be pursued, such a large amount of financial fraud, accounting can never escape the relevant. (Sina Pharmaceutical News)