The general manager was taken away! CSC, something happened again?
"Gatekeeper", can you really keep the door?
1
CSC, the general manager was taken away
The financial circle is in turmoil again.
On the evening of June 1, CSC issued an announcement that Li Geping, executive director, submitted a resignation report to the company's board of directors due to personal reasons, applying for resignation as the company's executive director, a member of the board's development strategy committee, a member of the board's risk management committee, and the company's general manager, executive committee member, and financial leader.
According to the data, Li Geping was born in 1967, is 56 years old this year, and is a veteran of the securities industry. At the beginning of his career, Li Geping taught at Zhongnan University of Finance and Economics, then joined Hubei Securities (now Changjiang Securities), and then successively served as the secretary-general of the Securities Association of China and the deputy director of the institutional department of the China Securities Regulatory Commission. In February 2018, Li Geping joined CSC and has served as an executive director, general manager and member of the executive committee for a long time.
According to the interface news report, on May 29, 2023, CSC held the 53rd meeting of the second board of directors at the company's headquarters, and Li Geping also attended the meeting.
It is worth mentioning that Wang Changqing, chairman of CSC, turns 60 this year and is about to retire. There have long been rumors that Li Geping will succeed Wang Changqing as the chairman of CSC.
At such a critical moment, why did Li Geping suddenly resign? The Caixin report gives the answer -
Li Geping was taken from his office on May 29, and sources revealed that the exact reason was unknown to assist in the investigation.
Although CSC said that the company's operation is normal, Li Geping's resignation will not affect the normal operation of the board of directors and the company's daily operations. But just a few months ago, Wang Qingshan, president of Zheshang Securities, was just taken away, and the outside world inevitably had a reverie.
After all, CSC has a lot of weight in the industry. CSC Securities was founded in 2005, formerly known as Huaxia Securities, which is known as one of the first three national securities companies in China. According to the statistics of Caijing magazine, CSC's revenue scale ranked fifth in 2022 and belonged to the first echelon of brokers.
▲Source: The reading is unique
2
Amethyst storage case, the aftermath is still there
Before Li Geping was taken away, CSC was deeply involved in another turmoil.
In February 2020, as the only company in China with 25G Blu-ray disc mass production capacity, Amethystum Storage was listed on the Science and Technology Innovation Board, and its stock price rose by 264.08% on the first day of listing.
Interestingly, in the first year of listing, the net profit of Amethystum Storage fell by 24.71% year-on-year, and the net profit attributable to the parent fell by 93.39% year-on-year. In 2021, the performance of Amethystum Storage is even more exaggerated——
The net profit loss attributable to the parent was 229 million yuan, down 379.85% from the same period last year.
▲Source: Baidu Stock Connect
This reversal has confused investors: why did the star company, which had a net profit growth rate of less than 30% in previous years, have a "big change" after listing?
With the involvement of regulation, the secrets of amethyst storage began to surface. We found that there are doubts about Amethystum Storage's advance payment, business model, accounts receivable, upstream and downstream. In March 2022, Amethystum Storage revealed that there were 16 illegal guarantees, with a cumulative amount of 373 million yuan.
Soon, Amethyst Storage transformed into *ST Amethyst and came to the brink of delisting. The actual controller of the company was also investigated by the CSRC for suspected violations of credit approval laws and regulations.
In the face of such a blatant operation of Amethystum Storage, investors with serious losses began to defend their rights, and pointed the finger at Amethystum Storage's sponsor and supervision agency, CSC Securities.
According to the relevant requirements, the main responsibility of the sponsor is to recommend qualified enterprises for listing, and has the responsibility to ensure that the applicant is suitable for listing, the accuracy and completeness of the listing documents, and the directors are aware of their own responsibilities and obligations.
Even after the listing of an enterprise, during the sponsor liability period, the sponsor should perform due diligence verification obligations on all publicly disclosed information of the listed company before public disclosure, and ensure that the information disclosure of the listed company meets the requirements of truthfulness, accuracy, completeness and timeliness.
In October 2021, CSC Securities clearly stated in the special verification opinion of the "Shanghai Stock Exchange Information Disclosure Regulatory Inquiry Letter on Amethystum Storage's 2021 Semi-Annual Report"——
At the end of June 2021, except for the restricted funds used to issue bankers' acceptances, the remaining funds were not restricted due to pledges, guarantees, etc.
Embarrassingly, after Amethystum Storage revealed that it was involved in breach of guarantees, it showed that there were 4 illegal guarantees, which occurred between March and April 2021.
In the face of such a major mistake, even regulation can no longer stand it. According to the previous disclosure of Amethystum Storage, Amethystum Storage and the five responsible persons were disciplined by the Shanghai Stock Exchange, and Liu Nengqing and Qiu Ronghui, the two continuous supervision sponsor representatives involved in the incident, were notified and criticized.
In addition, according to CSC's announcement, as the sponsor and lead underwriter of *ST Amethyst, it plans to set up a special fund for the advance payment of *ST Amethystum cases. CSC said it would jointly invest 1 billion yuan with other intermediaries to set up a special fund for advance compensation.
According to public information, the listing of Amethystum Storage brought 120 million yuan of sponsorship and underwriting fees to CSC Securities. I don't know, is this money enough to pay?
3
Risk control is in question
Speaking of which, this is not the first time CSC has experienced such a thing.
According to IPO Global's combing, since 2023, CSC has received a number of regulatory fines -
On January 12, two Baodai Sui Yuyao and Pan Keyao of CSC were warned in writing by the Shenzhen Stock Exchange for failing to fully verify the requirements of the "Sponsor Due Diligence Work Guidelines" and other practice standards in the Shengtel IPO project.
On February 10, the central bank disclosed administrative penalty information showing that CSC was fined 13.88 million yuan for failing to perform customer identification obligations in accordance with regulations.
On March 13, due to the lack of strict control, insufficient work standardization, and insufficient performance of duties by entrusted management in the process of carrying out bond underwriting business, the Beijing Securities Regulatory Bureau ordered it to take corrective measures...
If you stretch the time a little longer, there are more similar things. A classic example is that in 2019, due to problems such as weak accounting foundation, lack of internal control and incomplete information disclosure, the CSRC made a decision not to register the company's application for issuing shares and listing.
This is the first case of registration rejection since the pilot registration system of the Science and Technology Innovation Board. The sponsor of this company is CSC Securities.
You know, as a leading brokerage, CSC's senior salaries in the field of risk control are not low. According to data from Oriental Wealth, the salary of Ding Jianqiang, compliance director of CSC Securities, was as high as 4.693 million, which was higher than the salary of the chairman.
▲Source: Oriental Wealth
This makes people wonder, a leading brokerage, compliance executives with high salaries, why do risk control problems frequently occur?
4
End
Alarm bells have sounded.
As the former "first share of optical storage", Amethystum Storage was determined by the China Securities Regulatory Commission to be fraudulent issuance and illegal credit disclosure, and was required to be forced to delist, becoming the first batch of delisted companies on the Science and Technology Innovation Board.
At the same time, intermediaries such as CSC involved in the case were also punished accordingly. The CSRC publicly stated that -
Implement the "zero tolerance" requirement and carry out "one case and two investigations".
In 2022, at least 60 securities firms received 130 fines, and investment banking business became the hardest hit area, and many leading securities companies were prominently listed. This "storm" indicates that the regulatory authorities are strengthening the punishment of "gatekeepers" -
Selecting excellent companies is the level, and selecting real companies is the bottom line.
If the bottom line is to be repeatedly emphasized, it is the greatest sadness of an industry.