The China Securities Regulatory Commission (CSRC) issued an advance notice of administrative penalties and market-entry bans against listed company Lifang Shuke for allegedly making false statements in periodic reports by inflating revenue and costs over 2021–2023. The Anhui office of the CSRC proposed a CNY 10 million fine for the company and combined fines of CNY 30 million for 10 responsible individuals, including Wang Yi. The misconduct involved using agency business arrangements, financing trade and fictitious trade to cumulatively overstate revenue by CNY 638 million and costs by CNY 628 million. The overstatements were CNY 280 million revenue and CNY 277 million costs in 2021, CNY 312 million revenue and CNY 305 million costs in 2022, and CNY 46 million revenue and CNY 45 million costs in 2023. The CSRC indicated the case may trigger a “major illegal” mandatory delisting scenario, with the Shenzhen Stock Exchange set to initiate delisting procedures. Separately, the CSRC opened a formal investigation into the conduct of the accounting firm involved and said it would transfer any suspected securities crime leads to public security authorities in line with its referral approach.
China Securities Regulatory Commission 2025-11-28
China Securities Regulatory Commission issues penalty and market ban pre-notice for Lifang Shuke over three-year financial misstatements
The China Securities Regulatory Commission (CSRC) announced penalties and market-entry bans against Lifang Shuke for allegedly inflating revenue and costs in reports from 2021 to 2023. The Anhui office proposed fines totaling CNY 40 million for the company and responsible individuals, with potential mandatory delisting by the Shenzhen Stock Exchange. The CSRC also launched an investigation into the accounting firm involved and plans to refer suspected securities crimes to public security authorities.