Market Highlights | Wu Gang, chairman of Jiuding Group, was investigated for suspected violations of fund regulations

With the aura of "the first private equity share of the New Third Board" and "the first company with a market value of 100 billion yuan on the New Third Board", Wu Gang, the leader of Jiuding Group, was investigated.

Wu Gang graduated from Southwestern University of Finance and Economics and successively served as the project manager of the investment banking department of Minfa Securities; the deputy director and director of the China Securities Regulatory Commission; the assistant to the president of Guangxi Beibu Gulf International Port Group; and the chairman of Kunwu Jiuding, etc., and was once regarded as a model for officials to go to the sea to start a business.

According to the announcement issued by Jiuding Investment, Wu Gang, a director of the company, recently received the "Notice of Case Filing" from the CSRC, and because of its related behavior, it was suspected of violating the relevant laws and regulations of the fund, and on July 23, the CSRC decided to file a case against him.

On the same day, jiuding group of new third board companies released nearly the same content as Jiuding Investment, a listed company on the main board, except that Wu Gang's position in Jiuding Group was "chairman of the company".

According to public information, Jiuding Group is the indirect controlling shareholder of Jiuding Investment.

Both announcements said that the matters involved in this case are investigations of Wu Gang personally, do not involve the company's private equity investment management business, and have no significant impact on the company's daily operations. At present, the operation and management and financial status of the company and its subsidiaries are normal, and the company will continue to pay attention to the progress of the investigation and fulfill the obligation of information disclosure in accordance with relevant regulations.

According to media reports, the investigation may involve Wu Gang's violation of the fund company governance regulations. Some people in the relevant industry believe that the reason why Wu Gang was investigated may be related to the business model of Jiuding.

In the early days, Jiuding achieved rapid expansion by relying on the "factory assembly line" PE model of grabbing Pre-IPO projects on a large scale, suddenly entering shares, and earning a listing premium after the project company was listed.

At the beginning of this year, the CSRC issued the Several Provisions on Strengthening the Supervision of Private Investment Funds, which further strengthened the supervision of private funds and severely cracked down on various violations of laws and regulations. The new regulations explicitly prohibit a series of violations of laws and regulations, such as lending, guarantees, clear shares and real debts, capital pool business, and self-financing.

Looking back at the development process of Jiuding, it has been warned and punished for violations many times.

Founded in 2010, Jiuding Group is a comprehensive investment group focusing on private equity investment management business. In April 2014, Jiuding Group was listed on the New Third Board, becoming the first private equity investment institution to land on the New Third Board.

In 2015, Jiuding issued a 10 billion fixed increase plan to invest heavily in the financial industry. Since then, due to major events, Jiuding has suspended trading until 2018, setting a record for the longest suspension time in the history of the New Third Board.

After setting a record for the longest suspension in the history of the New Third Board, Jiuding was fined 600 million yuan in January this year.

Earlier, Jiuding Group issued an announcement that the company received an advance notice of administrative penalties from the China Securities Regulatory Commission, confiscating 501 million yuan of illegal gains and imposing a fine of 100 million yuan for using other people's accounts to engage in securities transactions; giving a warning to Wu Gang, executive director of Jiuding Holdings and chairman of Jiuding Group, and imposing a fine of 100,000 yuan. At the same time, due to the violation of the second fixed increase in CITIC approval in 2014, the CSRC ordered it to make corrections, gave a warning, and imposed a fine of 600,000 yuan.

According to the 2021 semi-annual report of Jiuding Group, its revenue in the first half of the year was 1.320 billion yuan and its net profit was 449 million yuan, compared with the loss of 391 million yuan in the same period last year. The total assets of the company are 39.775 billion yuan.

More specific information on the matter of "Wu Gang being investigated" still needs to be further released by the regulator. As of press time, Jiuding Investment reported 14.25 yuan / share, down 9.35%, and the current total market value is 6.178 billion yuan.

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