China Economic Network Beijing, December 25, 2020 The Administrative Penalty Decision [2020] No. 9 and the Market Prohibition Decision [2020] No. 2 issued by the Jilin Supervision Bureau of the China Securities Regulatory Commission yesterday show that Jilin Putai Equity Investment Fund Management Co., Ltd. (hereinafter referred to as "Putai Fund") has failed to go through the fund filing procedures in accordance with the regulations; raising funds from individuals other than qualified investors, the number of investors in a single private fund under management exceeds the specific number prescribed by law Three illegal facts, such as promising investors that the investment principal would not be lost or promising a minimum return, were ordered by the Jilin Supervision Bureau to make corrections, give a warning, and impose a fine of 30,000 yuan.
It was found that putai Fund had the following illegal facts:
1. Failure to go through the fund filing formalities in accordance with the regulations
Changchun Chenxing Yongtai Equity Investment Fund Partnership (Limited Partnership) (hereinafter referred to as Morningside Yongtai), Changchun Putai Equity Investment Fund Partnership (Limited Partnership) (hereinafter referred to as Changchun Putai) and Changchun Putai Dinghong Equity Investment Fund Partnership (Limited Partnership) (hereinafter referred to as Putai Dinghong) managed by Putai Fund did not go through fund filing procedures in accordance with the provisions of the Asset Management Association of China.
2. Raise funds from individuals other than qualified investors, and the number of investors in a single private fund under management exceeds the specific number prescribed by law
In the process of raising private funds of Morningside Yongtai, Changchun Putai, Putai Dinghong and Changchun Putai Xiangyun Equity Investment Fund Partnership (Limited Partnership) (hereinafter referred to as Putai Xiangyun), Putai Fund raised funds from individuals other than qualified investors, and some investors invested less than 1 million yuan, which did not meet the qualified investor standards. The above-mentioned private equity funds managed by Putai Fund are all partnership-type private equity investment funds, and the number of investors in the above-mentioned private funds exceeds the upper limit of 50 as stipulated in Article 61 of the Partnership Law.
3. Promise to investors that the principal amount of the investment will not be lost or promise a minimum return
Putai Fund provides investors of Changchun Putai and Putai Xiangyun Private Equity Fund with a "Letter of Guarantee" issued by Jilin Wanbang Non-Financing Guarantee Co., Ltd., providing joint and several liability guarantee for investors' investment principal and income. According to the different investment amounts and investment periods of investors, Putai Fund agrees with investors of Morningside Yongtai, Changchun Putai, Putai Dinghong and Putai Xiangyun Private Equity Funds with different annualized rates of return, and pays returns to investors regularly according to the agreed annualized rate of return.
The above-mentioned acts of Putai Fund violated the provisions of Article 8, Paragraph 1, Article 11, Paragraph 1 and Article 15 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds, and constituted the illegal acts described in Article 38 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds.
In accordance with article 38 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds, the Jilin Supervision Bureau decided to order the Putai Fund to make corrections, give a warning, and impose a fine of 30,000 yuan.
For the above-mentioned illegal acts of Putai Fund, Chen Shuyang, then the legal representative and actual controller of Putai Fund, was the directly responsible supervisor.
In accordance with Article 39 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds and Article 7 and Article 5 of Article 3 of the Provisions on the Prohibition of Access to the Securities Market (Order No. 115 of the Securities Regulatory Commission), the Bureau of Jilin Supervision decided to impose a ten-year ban on Chen Shuyang from the securities market.
According to the data, Putai Fund was established on October 12, 2013, with a registered capital of 100 million yuan, and its business scope includes managing or entrusting the management of equity investments; related equity investment consulting business (shall not engage in financial management, illegal fund-raising, illegal deposit absorption, loans and other businesses; prohibited by laws, regulations and decisions of the State Council; licensed business projects shall operate with valid licenses or approval documents). The shareholder of the company is Chen Shuyang, with a shareholding ratio of 100%.
Relevant regulations:
Article 8 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds: After all kinds of private funds have been raised, the private fund manager shall, in accordance with the provisions of the Asset Management Association, go through the fund filing procedures and submit the following basic information: (1) the main investment direction and the fund type indicated according to the main investment direction; (2) the fund contract, the articles of association or the partnership agreement. Where a fund prospectus is provided to investors in the course of fund raising, the fund prospectus shall be submitted. Private equity funds established in the form of companies, partnerships, or other enterprises shall also submit copies of the original copy of the industrial and commercial registration and business license; (3) Where the entrusted management method is adopted, the entrusted management agreement shall be submitted. Where a custodian institution is entrusted with the custody of fund assets, the custody agreement shall also be submitted; (4) other information prescribed by the Asset Management Association. The Asset Management Association shall, within 20 working days after the filing materials of the private fund are complete, complete the filing formalities for the private fund by announcing the list of private funds and their basic information through the website.
Article 11 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds: Private funds shall be raised from qualified investors, and the cumulative number of investors in a single private fund shall not exceed the specific number prescribed by the Securities Investment Fund Law, the Company Law, the Partnership Law and other laws. Where an investor transfers fund shares, the transferee shall be a qualified investor and the number of investors after the transfer of fund shares shall comply with the provisions of the preceding paragraph.
Article 15 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds stipulates that private fund managers and private fund sales institutions shall not promise investors that the principal of their investment will not be lost or promise a minimum return.
Article 38 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds: Where a private fund manager, a private fund custodian, a private fund sales institution or other private equity service institution and its practitioners violate the provisions of Articles 7, 8, 11, 14 to 17, 24 to 26 of these Measures, as well as any of the acts listed in Items 1 to 7 and 9 of Article 23 of these Measures, they shall be ordered to make corrections, given a warning and fined not more than 30,000 yuan Directly responsible supervisors and other directly responsible personnel shall be given a warning and fined not more than 30,000 yuan; those who commit acts in item 8 of Article 23 of these Measures shall be punished in accordance with the relevant provisions of the "Securities Law" and the "Regulations on the Administration of Futures Trading"; if a crime is constituted, it shall be transferred to the judicial organs for criminal liability in accordance with law.
Article 39 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds: Where private fund managers, private fund custodians, private fund sales institutions and other private equity service institutions and their practitioners violate laws and regulations and the provisions of these Measures, and the circumstances are serious, the CSRC may, in accordance with law, take market entry prohibition measures against relevant responsible personnel.
Article 3 of the Provisions on Prohibition of Access to the Securities Market: If the following persons violate laws, administrative regulations or relevant provisions of the CSRC, and the circumstances are serious, the CSRC may adopt measures to prohibit access to the securities market according to the seriousness of the circumstances: (1) directors, supervisors and senior management personnel of issuers, listed companies, unlisted public companies, directors, supervisors and senior management personnel of other information disclosure obligors or other information disclosure obligors; (2) controlling shareholders of issuers, listed companies, and unlisted public companies, The actual controller, or the directors, supervisors and senior management personnel of the controlling shareholder or actual controller of the issuer, listed company or unlisted public company; (3) the directors, supervisors and senior management personnel of the securities company and the responsible persons of its internal business departments, branches or other securities practitioners; (4) the controlling shareholder, the actual controller of the securities company or the controlling shareholder or the controlling shareholder of the securities company, the directors, supervisors and senior management personnel of the actual controller; (5) the directors, supervisors and senior management personnel of the securities service institution, Senior management personnel and other personnel engaged in securities service business and directors, supervisors and senior management personnel of the actual controller of securities service institutions or actual controllers of securities service institutions; (6) directors, supervisors, senior management personnel of securities investment fund managers and custodians of securities investment funds, as well as the responsible persons of their internal business departments, branches or other securities investment fund practitioners; (7) other relevant responsible personnel determined by the CSRC to have violated laws, administrative regulations or relevant provisions of the CSRC.
Article 5 of the Provisions on Prohibition of Access to the Securities Market: Where violations of laws, administrative regulations, or relevant provisions of the China Securities Regulatory Commission are serious, measures may be taken to ban access to the securities market for 3 to 5 years against the relevant responsible personnel; where the circumstances are more serious, such as bad behavior, serious disruption of the order of the securities market, serious harm to the interests of investors, or playing a major role in major illegal activities, measures may be taken against the relevant responsible personnel for 5 to 10 years; Relevant responsible personnel may be subject to lifelong measures to ban access to the securities market: (1) serious violations of laws, administrative regulations, or relevant provisions of the China Securities Regulatory Commission, constituting a crime; (2) personnel engaged in securities business such as sponsorship, underwriting, asset management, margin financing, and other securities services, and personnel with statutory duties, who intentionally fail to perform their obligations stipulated by laws, administrative regulations, or the China Securities Regulatory Commission, and cause particularly serious consequences; (3) violating laws, administrative regulations, or relevant provisions of the China Securities Regulatory Commission by concealing, Fabricating important facts and other particularly heinous means, or the amount involved in the case is particularly huge; (4) violating laws, administrative regulations, or relevant provisions of the China Securities Regulatory Commission, engaging in illegal acts such as fraudulent issuance, insider trading, or market manipulation, seriously disrupting the order of the securities and futures markets and causing serious social impact, or obtaining improper benefits such as illegal gains, or causing particularly serious damage to the interests of investors; (5) Violating laws, administrative regulations, or relevant provisions of the China Securities Regulatory Commission, with serious circumstances, Measures to prohibit access to the securities market shall be adopted, and there are acts of obstructing or resisting the exercise of supervision, inspection, and investigation functions and powers by the securities regulatory authority and its staff in accordance with the law, such as deliberately issuing false and important evidence, concealing or destroying important evidence; (6) being given administrative penalties by the CHINA Securities Regulatory Commission more than 3 times in 5 years in addition to warnings for violating laws, administrative regulations, or relevant provisions of the China Securities Regulatory Commission, or having been banned from the securities market within 5 years; (7) organizing, planning, leading, or implementing major violations of laws, Activities that violate laws, administrative regulations or relevant provisions of the China Securities Regulatory Commission; (8) other violations of laws, administrative regulations, or relevant provisions of the China Securities Regulatory Commission, where the circumstances are particularly serious.
The following is the original text:
Administrative Penalty Decision of Jilin Regulatory Bureau of China Securities Regulatory Commission [2020] No. 9 (Putai Fund)
Party: Jilin Putai Equity Investment Fund Management Co., Ltd. (hereinafter referred to as Putai Fund), domicile: Nanguan District, Changchun City, Jilin Province.
In accordance with the relevant provisions of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds, our bureau conducted a case investigation and trial of the illegal acts of Putai Fund, and informed the parties of the facts, reasons, basis and rights enjoyed by the parties in accordance with the law, and the parties did not submit statements and defense opinions. The case has now been investigated and the trial has been concluded.
The above-mentioned illegal facts are proved by evidence such as the registration and filing information of the Asset Management Association, relevant fund contracts, relevant fund account books, bank account flows, and interrogation records, which are sufficient to determine.
Based on the facts, nature, circumstances and degree of social harm of the parties' illegal acts, and in accordance with the provisions of Article 38 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds, our bureau decides:
Putai Fund was ordered to make corrections, given a warning, and fined 30,000 yuan.
The above-mentioned parties shall, within 15 days from the date of receipt of this penalty decision, remit the fine to the China Securities Regulatory Commission, and the bank opening the account: the business department of the Beijing branch of China CITIC Bank, account number: 7111010189800000162, shall be directly handed over to the State Treasury by the bank, and a copy of the payment voucher with the name of the party shall be sent to our bureau for the record. If the parties concerned are dissatisfied with this penalty decision, they may apply to the China Securities Regulatory Commission for administrative reconsideration within 60 days of receiving this penalty decision, or they may directly file an administrative lawsuit with the people's court with jurisdiction within 6 months from the date of receipt of this penalty decision. During the period of reconsideration and litigation, the implementation of the above-mentioned decision shall not be suspended.
Jilin Securities Regulatory Bureau
December 23, 2020
Decision of the Jilin Regulatory Bureau of the China Securities Regulatory Commission on Market Access Prohibition [2020] No. 2 (Chen Shuyang)
Party: Chen Shuyang, male, born in October 1969, was the legal representative and actual controller of Jilin Putai Equity Investment Fund Management Co., Ltd. (hereinafter referred to as Putai Fund), address: Chaoyang District, Changchun City, Jilin Province.
In accordance with the relevant provisions of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds, our bureau conducted a case investigation and trial of the illegal acts of Putai Fund, and informed the parties of the facts, reasons, basis and rights enjoyed by the parties in accordance with the law, and the parties did not submit statements, defense opinions, or request a hearing. The case has now been investigated and the trial has been concluded.
In accordance with Article 39 of the Interim Measures for the Supervision and Administration of Private Equity Investment Funds and Article 7 and Article 5 of Article 3 of the Provisions on the Prohibition of Access to the Securities Market (Order No. 115 of the Securities Regulatory Commission), our bureau decides:
Chen Shuyang was banned from the securities market for ten years. From the date on which the Self-Bureau announces its decision, during the period of prohibition, except for continuing to engage in securities business in the original institution or serving as a director, supervisor or senior manager of the original listed company or unlisted public company, it is also forbidden to engage in securities business in any other institution or to hold the position of director, supervisor or senior management of other listed companies or unlisted public companies.
If the parties are dissatisfied with the decision to ban access to this market, they may apply to the China Securities Regulatory Commission for administrative reconsideration within 60 days of receiving this decision, or they may directly file an administrative lawsuit with the people's court with jurisdiction within 6 months from the date of receipt of this decision. During the period of reconsideration and litigation, the implementation of the above-mentioned decision shall not be suspended.
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