Half a year after being placed on file for investigation, Zhejiang Furun, a listed company, finally received a penalty notice from the China Securities Regulatory Commission, and the company and related responsible persons were fined 14.4 million yuan for fraud of 700 million.
The total amount seems to be not small, but when it comes to the two masterminds, it is only 5 million, 2.5 million for one person, and the amount of personal fines is 2% of the total amount of fraud.
Of course, under the existing system, this may already be the limit of the CSRC's punishment, but it is still not worth mentioning compared to the harm suffered by shareholders as a result.
According to public information, Zhejiang Furun's financial fraud was discovered by an accounting firm during the audit of the 2022 annual report, and an audit report with a qualified opinion and an internal control audit report with a negative opinion were issued.
As a result, Zhejiang Furun was immediately ST, and at the same time corrected the financial data for 2020-2022, and issued all relevant announcements on the evening of April 27, 2023.
After the announcement was issued, it was the May Day holiday, and the listed company may have thought that the digestion of the holiday could offset some emotions, but it still triggered a continuous plunge after the holiday.
However, at that time, a few falling limits were just the beginning, and then Zhejiang Furun entered a downward channel, and now it has come to the vicinity of the one-yuan line.
During this period, the market value of listed companies evaporated by 2 billion, and based on the 60% shareholding ratio of ordinary shareholders, the 20,000 shareholders of Zhejiang Furun lost 1.2 billion.
Some people may say that very few shareholders have held it from that time to the present, and the loss should not be calculated in this way.
In fact, this is not important, the ups and downs of stocks are bought by stockholders, and the evaporated 1.2 billion must be a loss, the difference is only that the loss is Zhang San, Li Si, or Wang Wu and Zhao Liu.
Shareholders have suffered heavy losses, what about the two masterminds?
In fact, according to the CSRC's penalty announcement, only one mastermind was identified as Fu Haipeng, who was the executive deputy general manager of Zhejiang Furun at the time and concurrently served as the general manager of the subsidiary Taiyi Zhishang, and the fraud occurred in the subsidiary Taiyi Zhishang, which was personally organized and implemented by Fu Haipeng.
The counterfeiting method is not technical, that is, Fu Haipeng found several advertising agencies from outside, and everyone went back and forth to form the so-called advertising agency business income.
From 2020 to the first half of 2022, Fu Haipeng easily generated a revenue of more than 700 million without much effort, and it must be natural to be identified as the mastermind.
However, Gray Pigeon believes that Jiang Yougui, chairman of Taiyi Zhishang, a subsidiary identified by the China Securities Regulatory Commission as "failing to perform his duties diligently and prudently", should also be regarded as one of the masterminds.
Not only because Jiang Yougui is the direct person in charge of the subsidiary Taiyi Zhishang, but more importantly, Jiang Yougui, Fu Haipeng and Taiyi Zhishang were originally a community.
According to public information, Taiyi Index became a subsidiary of Zhejiang Furun in 2016 through the acquisition of equity, and the assessed net assets were less than 300 million at that time, but the purchase price of 1.2 billion was made.
Jiang Yougui and Fu Haipeng were the major shareholders at that time, of which Jiang Yougui held 27% of the shares, and Fu Haipeng held 13.9% of the shares, according to the transaction consideration of 1.2 billion, Jiang Yougui accounted for 324 million and Fu Haipeng accounted for 167 million.
Of course, not all of them were paid in cash, only 20% of the cash was given, and the other 80% was in the form of issuing shares, so Jiang Yougui and Fu Haipeng became the second and third largest shareholders of Zhejiang Furun, and at the same time became the core executives of the listed company.
From 2016 to 2018, Taiyi has barely completed the three-year performance commitment, but the three-year commitment period has shown its original shape as soon as it has passed, making everyone lose face.
Thus, the motive for financial fraud emerges, and there is the storyline mentioned at the beginning.
However, it is not over here, the so-called slap is not loud, why is Zhejiang Furun willing to acquire Taiyi Zhishang, which was only 4 years old at that time, at a premium?
This has to briefly mention the past and present life of Zhejiang Furun.
Zhejiang Furun was originally a local state-owned knitting factory in Zhuji, Zhejiang, founded in 1982, and after the development and growth in the 90s, it successively merged more than 20 state-owned enterprises of Zhuji's wineries, wool textile factories, silk textile factories, fertilizer factories and trading companies, and then established Furun Holding Group.
As a subsidiary of Furun Holding Group, Zhejiang Furun was listed in 1997 and is also the first listed company in Zhuji, Zhejiang.
But what is surprising is that in 2011, Furun Holding Group suddenly restructured and sold 81% of the equity to the management for 520 million yuan, and now Zhao Linzhong, the actual controller of Zhejiang Furun, is the chairman of Furun Holdings before the restructuring.
Zhejiang Furun changed from a state-owned enterprise to a private enterprise, and investors thought that there would be a surprise, but after waiting for three years, they did not wait for a surprise, but waited for a fright.
In 2014, Zhejiang Furun suffered its first loss since its listing, losing more than 60 million, which was blamed on the decline of traditional business, so the so-called Internet transformation was put on the agenda.
It was in this context that the previously fraudulent subsidiary Taiyi Zhishang became the acquisition target of Zhejiang Furun.
Digital marketing must belong to the Internet business, but buying a company that does digital marketing business does not mean that the Internet transformation has really been realized, but at that time, Zhejiang Furun firmly believed that a Thai finger was enough to support the entire listed company.
As a result, Zhejiang Furun gradually spun off the original business assets such as printing and dyeing, textiles, and seamless steel pipes from listed companies to achieve a complete transformation of the Internet.
Strangely, after some traditional business subsidiaries that were originally controlled by listed companies were sold back to Furun Holdings, the controlling shareholder is now no longer Furun Holdings, but has become a natural person (as shown in the figure above).
For example, the current actual controller of Zhejiang Furun Textile Co., Ltd. is Ying Yehua, and Furun Holdings holds only 30% of the shares.
For example, the current actual controller of Zhejiang Furun Printing and Dyeing Co., Ltd. is Fu Guozhu, and Furun Holdings holds only 30% of the shares.
It is worth mentioning that Fu Guozhu and Ying Yehua are both shareholders of Furun Holdings, and in order to help listed companies strip off inefficient assets, these shareholders took the initiative to take over the "sacrifice" is not small.
Of course, these are all in the past, and now shareholders are more concerned about how Zhejiang Furun will go next, anyway, Taiyi is still not counting on it, and the main business is only to help operators sell number cards, and whether they can support themselves is probably a problem.
Interestingly, Zhejiang Furun's performance forecast for 2023 has been made twice, and the data of the two times is quite a lot.
On January 27, 2024, Zhejiang Furun first announced a revenue of 130 million yuan in 2023 and a loss of 400 million to 460 million yuan.
More than two months later, on April 16, 2024, Zhejiang Furun issued another correction and apology announcement, with revenue adjusted to 93.5 million and profit adjusted to a loss of 560 million.
The revenue is less than 100 million, that is to say, the name change to *ST Furun is a certainty.
I can't make money in business, I am not rich on the books, more than 60 million currency and cash, which is not enough to pay for a short-term loan of 100 million, and I have to reserve liquidity, how will Zhejiang Furun live in 2024, this is a common concern of 20,000 shareholders.