Doxxing hundreds of billions of Noah's wealth: Tan Wenqing is the key gentleman, stepping on thunderstorms, LeTV, and Huishan

Two public statements have thrust Noah Fortune (i.e., "Noah Holdings") into the spotlight again. 

At noon on December 4, 2023, JD.com's official Weibo issued a statement, saying that "Noah Fortune maliciously sued JD.com and misled investors and the public", and the statement also pointed out that "Noah Fortune has had more than ten similar incidents in recent years... It has been repeatedly warned and punished by the regulatory authorities, indicating that it has long-term serious risk control deficiencies. ” 

On the evening of the same day, Noah Fortune issued a response, saying that the description of "more than ten similar incidents occurred in Noah Fortune" in the above-mentioned "Statement" was seriously inaccurate, and "it has infringed on the reputation of our company, and legal measures will be taken to protect our rights and interests." ” 

Nandu reporters noticed that in recent years, Noah's wealth, which has been covered by many halos, has indeed stepped on many deep pits such as Huishan Dairy, LeTV, and Baofeng Group. 

A number of investors also said that in the case of the criminal case "Chengxing Fraud Case" has ruled that JD.com is not responsible, Noah's lawsuit against JD.com is delaying time and shirking responsibility.

1

"Mr. Key" Tan Wenqing

In some articles published by Noah Fortune's official channels, Noah's birth is a typical inspirational story, and it is covered with a hint of bitterness: Wang Jingbo, who was pregnant, faced the situation of being laid off by her old employer, Xiangcai Securities, so she and several colleagues were "forced" to set up her own business, and soon with her own efforts, she won the favor and capital injection of capital giants such as Shen Nanpeng and He Boquan, and has soared since then. 

"Like many start-ups, Noah got off to a hard start in a small office of just over 100 square meters in Lujiazui, Pudong," "In order to get customers, Wang Jingbo and her entrepreneurial partners, like young people who are real estate agents today, set up stalls and distribute promotional materials at the entrance of the community. That experience was described. 

However, it is clear that the office of more than 100 square meters in Lujiazui cannot be regarded as "small" for many mature companies, and the vast majority of real estate agents do not have a spouse with a luxurious network, and the truth of the story is only half told here. 

Wang Jingbo's husband, Tan Wenqing, was the general manager of the investment banking department of Beijing Securities (which has been reorganized), and later joined Xiangcai Securities, where he met Wang Jingbo. 

During his tenure at Xiangcai Securities, Tan Wenqing not only promoted the company's negotiations with CLSA and contributed to the birth of Huaou International, the first joint venture securities company in China, but also deeply participated in a series of capital operations of Shanghai Guobin Medical through Shanghai Dingfeng Technology Development Co., Ltd., a subsidiary of Xiangcai at that time. 

And He Boquan is Noah's angel investor, and after 45 minutes of communication with Wang Jingbo, Shen Nanpeng, who decided to pay $5 million, is also inseparable from He Boquan's threading and Tan Wenqing's "accidental introduction". 

In 2010, when Noah Fortune went public in the United States, the prospectus showed that Wang Jingbo held 25.2% of the company's shares (after the IPO), and Sequoia Capital and He Boquan's companies held 21.6% and 8.4% of the shares respectively. 

The early investment in Noah brought a lot of returns to He and Shen Lai. The former once revealed that investing in Noah brought him about 4,000 times the return, "This is also one of the investments I am most proud of." In October 2016, Sequoia Capital announced its strategic investment in Gopher Assets, a wholly-owned subsidiary of Noah Wealth, and the relationship between the two parties was further deepened. 

Cast the peach and repay Qiong Yao. The investors of Noah's "Gopher China Special Opportunities Fund No. 7" once revealed in the form of an open letter that the fund's investment target was some of the old shares of Douyu held by Sequoia Capital, but when the ban period had expired and the stock price of Douyu was at a high level of about $20 per share, it did not carry out any reduction actions, and only cleared the position when the stock price fell to about $1 per share, resulting in a loss of more than 75% for investors.

According to the open letter, Noah Holdings, the manager of the fund, has repeatedly concealed from investors risk clauses such as "after the listing of Douyu, Sequoia Capital can choose to distribute shares to the fund, and the follow-up management risks will be borne by Noah and Gopher investors", as well as key matters such as "Sequoia Capital has distributed Douyu shares to the fund at the end of 2020".

After paving the way for Noah's success, Tan Wenqing did not get too involved in the company's affairs after introducing two super investors, but while continuing to invest in his career, he founded "Enoch Education" and "Dingnuo Technology", which are engaged in high-net-worth individuals, family education, financial education, investment consulting and other businesses, which can complement Noah's business and extend services to high-net-worth individuals. Tan Wenqing also serves as the Chief Customer Experience Officer of Noah Wealth.

Of course, Wang Jingbo at the beginning of his business was not an ordinary employee facing dismissal, but was the general manager of the private finance department of Xiangcai Securities. Under the wave of restructuring and layoffs, Wang Jingbo carried out a "management buyout" with several old colleagues. Wang Jingbo's customer resources accumulated in Xiangcai for many years, Tan Wenqing's rich contacts, and the equity binding of He Boquan, Shen Nanpeng and others have woven a strong network of Noah Fortune's success. 

2

Ultra-high-net-worth individuals support hundreds of billions of assets

At the beginning of its birth, Wang Jingbo and her Noah Fortune targeted customers at high-net-worth individuals. 

According to the official WeChat, as of the end of the first half of 2023, Noah's cumulative asset allocation exceeded 980 billion yuan. According to the third quarterly report, as of September 30, 2023, the company's assets under management were 154.9 billion yuan, a decrease of 1.3% from the middle of the year. 

Noah Holdings' Hong Kong IPO prospectus disclosed that according to the four asset allocation amounts of 1 million yuan, 3 million yuan, 10 million yuan and 50 million yuan, Noah divides customers into "ivory, gold card, platinum, diamond card, black card" and other grades. 

As of the end of 2021, the company had 42,764 customers, including 1,722 black card customers, accounting for 46.5% of the allocated assets, and 6,575 diamond card customers, accounting for 37.8%. By the end of 2022, the total number of black card and diamond card customers reached 9,689, an increase of 18.2% year-on-year. 

These data mean that ultra-high-net-worth customers, who account for 19.4% of the number of people and have personal allocation assets of more than 10 million yuan, have brought 84.3% of Noah's asset allocation business scale.

Interestingly, as the head of Noah Wealth, Wang Jingbo emphasizes "serving" customers and "making friends with customers", while also often talking about "investor education", and uses this as a response to some products that do not meet expectations and even step on thunder. 

For example, in 2016, the Banyan Tree Fund, a hotel private equity project underwritten by Noah Wealth, was exposed to be "unfinished", and Wang Jingbo said in an interview that "Chinese investors are more anxious, for example, the hotel is a project that needs to be maintained, and from an international point of view, six years is not too long." In addition, when Gopher Fund was deeply involved in the Chengxing fraud case in recent years, Wang Jingbo emphasized in an internal letter that the company "has no rigid payment", and at the same time advocated the importance of "breaking the rigid payment" on many occasions. Previously, when Noah stepped on Lei Huishan Dairy, the company also issued a clarification statement, accusing "a very small number of investors for gathering and disseminating false information, wearing white clothes and banners to interfere with business operations in order to achieve rigid payment requirements". 

Breaking the rigid exchange is indeed the only way for the healthy development of the industry, but the reporter from Nandu noticed that the focus of many investors' doubts is not to carry out the rigid exchange, but the professionalism of Noah Fortune itself. 

For example, the investors of "Noah-Huishan" questioned why Noah disclosed the loan claim as an accounts receivable claim in the "Fund Contract"; investors in the "Sequoia-Betta" incident wanted to know why Noah deliberately concealed key terms and key information, and why, as a "professional" investment team, would miss many excellent times to reduce their holdings; and "Noah-Chengxing" investors did not understand that Noah, as a "wealth management expert and supply chain finance expert", would be easily defrauded of huge sums of money because of the carrot chapter and fake employees. 

"If the underlying assets are real, it is indeed because of the situation of JD.com that the product cannot be redeemed, and we will admit it", a number of investors said, "This is not a matter of whether it has just been redeemed or not, but a problem of Noah's management and risk control capabilities." ” 

At the same time, these investors revealed that their messages about Noah on some platforms have been completely unable to be sent. 

In recent years, Noah Holdings' performance has fluctuated. From 2020 to 2022, Noah Holdings achieved operating income of 3.306 billion yuan, 4.293 billion yuan and 3.1 billion yuan respectively, and net profit attributable to the parent company of -745 million yuan, 1.314 billion yuan and 976.6 million yuan. In the third quarter of 2023, the company's net income was 750 million yuan, an increase of 9.6% year-on-year, and the total operating income was 248 million yuan, an increase of 7.4% year-on-year. 

In terms of breakdown, the domestic scale of some of Noah's businesses has shown a downward trend. As of mid-2023, Noah Wealth's assets under management reached 156.9 billion yuan, an increase of 0.9% year-on-year, but the overseas assets under management increased by 15.8%, and the company's net income increased by 13.8% year-on-year during the reporting period, of which overseas net income increased by 104.1%. In the third quarter, the net income of Noah's asset management business increased by 1.8% year-on-year, mainly due to the increase in the scale of real estate investment of the New York team. 

3

Its products have continuously stepped on thunder, and have received many fines due to risk control and integrity

The most intuitive manifestation of investors' doubts about the professionalism of Noah Wealth is the successive lightning incidents. 

First of all, the first RMB hotel private equity fund in China, "Noah Banyan Tree Fund", issued in 2010, is managed by Tianjin Banyan Tree Capital, a subsidiary of Banyan Tree Group, and its interests include the operating income of two Banyan Tree hotels in Huangshan and Yangshuo, the sales income of two Banyan Tree Residences hotels in Lijiang and Huangshan, and 10% of the management fees of more than 10 other hotels in China. 

With Banyan Tree's signboard, the fund quickly completed a fundraising of 1.07 billion yuan. 

According to the description of investors, Noah, as the distributor, once said that when promoting the product, it "expects a return of 3.4 times, expects to recover the principal in 4 and a half years and goes public in 6 years", but in the end, due to the turmoil in the management of Tianjin Banyan Tree Capital and other reasons, the fund lost 30% after 6 years of operation, and even when the product was about to end, the filing had not yet been completed. 

In this regard, Guan Qingyou's Financial Research Institute wrote an analysis that Wang Jingbo had responded to the fund manager's reluctance to spend more time communicating with investors, so how did this kind of irresponsible product of the manager pass the Noah product review and enter the consignment list? 

Another product of Noah that exploded as a consignment is Noah Yongxuan Fund, the fund manager is Lianchuang Yongxuan, and the five products have raised a total of 1.594 billion yuan, including Western Mining, Hebei Taiheng Special Steel, Shaanxi Senchaling Nickel Industry, Runaway Comics and other projects. In the end, according to the feedback of investors at that time, there were exaggerated publicity problems in products 1 to 4, and there were pricing problems in No. 5 funds, that is, the Xinguan gold mine in Wenxian County, Gansu Province, the target of the investment, described in the promotional materials that "the historical proven reserves of the gold mine are 15 tons, and the proven reserves of the geological work in 2012 are 30 tons, and the prospective reserves are 50~100 tons", but as of the end of 2018, the recorded reserves of the gold mine are only 5 tons. 

If Noah can still shift the responsibility to his "teammates" in the above two cases of consignment, then some of the projects that he personally "stepped on" can only find another way out.

In August 2014, Jingtai Fund, issued by Wanjia Win-Win Asset Management Co., Ltd., a shareholding company of Gopher Assets, was soon exposed to a misappropriation scandal, and the fund manager Jingtai Company was found by the court to have deliberately defrauded, and the relevant participants were held criminally responsible.

On December 25, 2015, Baofeng Group announced that it would jointly invest 500 million yuan with Gopher Assets and Tianjin Pinglu E-commerce to set up Baofeng Xinyuan Internet Investment Center (hereinafter referred to as "Baofeng Xinyuan"), and Gopher invested 400 million yuan. The fund's investment targets include "storm" companies such as Jiuxing Entertainment, Storm Magic Mirror, and Storm Intelligence, which are listed on the New Third Board. At the end of 2019, due to the failure to achieve the exit as agreed, Baofeng Group was ordered to pay at least about 467 million yuan to Gopher Assets, which was composed of Baofeng Xinyuan's share transfer money and liquidated damages. At that time, the storm group was already mired in a quagmire. 

On August 19, 2016, LETV issued an announcement, saying that its wholly-owned subsidiary and Shenzhen Xingen Investment Fund Management Co., Ltd. established Shenzhen LETV Xingen M&A Fund Investment Management Enterprise (hereinafter referred to as "LETV M&A Fund"), as of the date of the announcement, Gopher Assets has subscribed for 2.3 billion yuan of priority shares.

LeTV M&A Fund Investment Targets TCL Multimedia, Coolpad Group, Shenzhen Super Duowei, Shenzhen Huixin Bridge and other companies, on October 29, 2018, LeTV announced that it had repaid 300 million yuan of principal to Priority (Gopher Assets), and said that most of the projects invested were in a state of loss. According to the 2019 annual report, as of the end of the current period, LeTV had non-current liabilities of 2.448 billion yuan to Gopher's assets.

In February 2017, a subsidiary of Tianjin Entertainment (now "Tianyu Digital") subscribed for an inferior share of 216.5 million yuan of Shenzhen Taiyue Investment Center (hereinafter referred to as "Shenzhen Taiyue") fund, Gopher Assets subscribed for a preferred share of 1.0425 billion yuan, and then Shenzhen Taiyue acquired 51% of the shares of Pocket Technology for 1.067 billion yuan.

Soon after, Tianjin Entertainment had a business crisis, and due to the triggering of the relevant repurchase clause, Gopher sued the former and successfully determined the debt of 945 million yuan. Unlike LeTV and Baofeng, Tianjin Entertainment finally succeeded in restructuring and avoided the fate of delisting, while Gopher obtained the corresponding shares of the debt in the reorganization, and then continued to reduce its holdings and withdraw.

Looking at it now, it can be said that Noah "accurately" entered the pit not long before the explosion of many "typical thunders" in the capital market. The reason for this may be from the fines given by the regulators.

In May 2018, Noah Hong Kong was reprimanded and fined HK$5 million by the Hong Kong Securities and Futures Commission for a number of irregularities such as imperfect risk assessment and deficiencies in internal systems and controls for the sale and distribution of investment products between January 2014 and June 2016, and in August 2018, Gopher Asset Management was issued a warning letter by the Jiangsu Securities Regulatory Bureau of the China Securities Regulatory Commission for failing to fulfill its "duty of good faith" and "duty of prudence and diligence" in the Huishan Dairy incident. 

In August 2023, the Jiangsu Provincial Securities Regulatory Bureau once again issued a warning letter to Gopher Asset Management for violating the rules in the process of managing the Genesis Dingxing Phase III No. 1 M&A Private Equity Fund and the Chuangshi Dingxing Phase III No. 2 M&A Fund. 

The above-mentioned companies, coupled with the 3.5 billion yuan hole brought by the "Chengxing Department", the cumulative fundraising scale of Noah's thunder stepping project has reached 10 billion yuan.

In 2019, Noah also issued a statement, saying that Banyan Tree Fund had completed its exit at the end of 2017 and achieved about 30% of the income, and at the same time said that the Jingtai incident had been successfully disposed of, the Yongxuan project had entered the exit period, and Huishan's claims were being disposed of, but the details were not given. 

Other projects are still in the process of being debated or waiting.  

[Case Retrospective]

The "Chengxing fraud case" refers to the fact that between February 2015 and June 2019, Chengxing Holdings and related companies defrauded Xiangcai Securities, Moshan Factoring, Shanghai Gopher, Yunnan Trust, Anhui Zhongxin and other institutions of more than 300 billion yuan of funds through fictitious supply chain trade with Suning and JD.com, and ultimately caused a loss of more than 80 billion yuan, of which Noah Holdings (6686. HK) and its subsidiaries involved in the case amounted to approximately RMB3.5 billion, mainly from the "Creation Core Enterprise Series Private Equity Fund" initiated and established by Shanghai Gopher Asset Management Co., Ltd. (hereinafter referred to as "Shanghai Gopher"). 

At the end of 2022, the Shanghai No. 2 Intermediate People's Court issued a judgment on the "Chengxing case", finding that Luo Jing, the actual controller of the "Chengxing Department", was sentenced to life imprisonment for the crimes of contract fraud and bribery of non-state employees, and his sister Luo Lan and ten other people involved in the case were sentenced together. 

The verdict also shows that JD.com, Suning and other companies and employees were unaware of Chengxing's fraud, and the relevant cooperation contracts, seals, and materials were forged. On the contrary, Fang Jianhua, a staff member of Noah Holdings, while accepting bribes of more than 200 yuan, provided convenience for Chengxing Company in terms of business docking, return visit due diligence, etc. 

On November 24, 2023, the case of Gopher Assets, a subsidiary of Noah Holdings, against JD.com, will be heard in the Shanghai Financial Court. Gopher Asset demanded that JD.com, Chengxing Holdings, Zhongcheng Industry, Suzhou Shengjun and other companies repay all the losses of more than 3.5 billion yuan that were determined in the "Chengxing system" criminal case. 

Written by: Nandu reporter Miao Lingyun from Shanghai