The China Securities Regulatory Commission issued an advance notice of administrative penalties against delisted Nanjing Yuebo Power System Co., Ltd. for information disclosure violations linked to financial statement fraud, and signalled that enforcement will also extend to third parties that assisted the misconduct. The investigation found that from 2018 to 2022 Yuebo Power inflated operating revenue and profits by fabricating new energy vehicle powertrain sales and other business, and by recording sham asset disposals, resulting in false statements in annual reports and other disclosures. Proposed measures include warnings and combined fines of CNY 30.8 million for the company and responsible persons, securities market bans of 8 to 10 years for two individuals, and fines of CNY 2 million and CNY 0.3 million for two accomplices who provided companies they controlled or coordinated to support the fictitious transactions; suspected criminal conduct will be referred to public security authorities. The CSRC framed direct punishment of fraud accomplices as part of the comprehensive prevention and deterrence framework set out in cross-agency opinions issued with the Ministry of Public Security, the Ministry of Finance and others in June 2024, and said it will continue to use administrative enforcement, referrals to competent authorities and criminal transfers to pursue both principal offenders and helpers, while allowing leniency where accomplices proactively rectify and materially cooperate with investigations.

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