The case of “washing powder running away” has finally been settled!
On the evening of December 28, Guangzhou Longqi (now known as Lonkey Industrial Co.Ltd.Guangzhou(000523) ), a washing products manufacturer, announced that the company had recently received the decision on administrative punishment issued by Guangdong securities regulatory bureau. According to the survey, the company falsely increased its revenue by more than 12.8 billion yuan, falsely increased its profit by 410 million yuan and falsely increased its inventory by more than 2 billion yuan from 2018 to 2019.
In this regard, Guangdong securities regulatory bureau decided to give a warning to Guangzhou Longqi and impose a fine of 4.5 million yuan, and give a warning to seven people, including the then chairman, and impose a fine of 9.55 million yuan.
On December 29, Guangzhou Longqi fell violently after the opening, closing at 3.31 yuan / share by midday, down 0.3%.
falsely increased revenue by more than 12.8 billion yuan in two years
In September 2020, Guangzhou Longqi’s inventory of 572 million yuan suddenly disappeared, which opened the tip of the iceberg of the company’s crazy fraud for two years.
it is found that Guangzhou Longqi falsely increased its operating revenue, operating costs and profits by making up bulk commodity trade business and circulating ethylene glycol warehouse receipts from 2018 to 2019. Among them, the operating income falsely increased by 6.234 billion yuan and 6.651 billion yuan respectively in the two years; Inflated operating costs of RMB 6.024 billion and RMB 6.45 billion; Inflated profits of 210 million yuan and 201 million yuan, accounting for 518.07% and 256.57% of the total profits disclosed in the current period.
In order to beautify the statement , in 2018 and 2019, Guangzhou Longqi also adjusted some falsely increased prepayments to falsely increased inventories, with the falsely increased inventory amounts of RMB 956 million and RMB 1082 million respectively, accounting for 75.84% and 78.58% of the inventory amount disclosed in the current period, and 50.53% and 56.83% of the net assets disclosed in the current period.
Meanwhile, Guangzhou Longqi failed to disclose the capital transactions and related related transactions of related parties as required from 2018 to 2019, and there were major omissions in the 2018 and 2019 annual reports.
Source: company announcement
the then chairman took the lead in organizing and planning fraud
Guangdong securities regulatory bureau also verified that during his tenure as the chairman of Guangzhou Longqi (June 2014 to may 2019), Fu Yongguo comprehensively managed the company’s affairs, organized and planned Guangzhou Longqi to implement financial fraud through fictitious commodity trade business and circular trading of ethylene glycol warehouse receipts, Aware of the false financial information in Guangzhou Longqi’s 2018 annual report and the undisclosed related party transactions and capital transactions between Guangzhou Longqi and its participating companies, he still signed and promised to ensure that the relevant documents are true, accurate and complete.
In addition, when Fu Yongguo served as the deputy general manager of Guangzhou Light Industry and Trade Group Co., Ltd., the controlling shareholder of Guangzhou Longqi (from April 2016 to March 2020), he continued to organize Guangzhou Longqi to implement financial fraud through fictitious commodity trade business and circular trading ethylene glycol warehouse receipts.
Guangdong securities regulatory bureau said that as the then chairman of Guangzhou Longqi, Fu Yongguo directly organized, planned and led the illegal acts involved in the case, which directly led to the illegal acts of relevant information disclosure of Guangzhou Longqi, and the circumstances were more serious.
before that, Guangdong securities regulatory bureau announced in November that it would ban Fu Yongguo from entering the securities market for 10 years. In July this year, Fu Yongguo was arrested by the Guangzhou Municipal People’s procuratorate according to law after the investigation by the Guangzhou Municipal Supervision Committee was completed and transferred to the procuratorial organ for examination and prosecution on suspicion of serious job-related crimes.
a total of 14.05 million yuan
Guangdong securities regulatory bureau also found that other persons directly responsible for the above illegal facts also included Chen Jianbin, then general manager, Chen Wen, then deputy general manager, Wang Zhigang, then Secretary of the board of directors, Wang Yingjie, then chief financial officer, Deng Yu, then director of business development department, and Huang Jianbin, then chief financial officer of Guangdong Qihua, a subsidiary of Guangzhou Longqi.
Based on the above facts, Guangdong securities regulatory bureau decided to give a warning to Guangzhou Longqi and impose a fine of 4.5 million yuan; Give a warning to Fu Yongguo and impose a fine of 3 million yuan; Chen Jianbin, Wang Zhigang, Deng Yu and Huang Jianbin were warned and fined 1.5 million yuan respectively; Give Chen Wen a warning and impose a fine of 500000 yuan; Wang Yingjie was given a warning and fined 50000 yuan.
Guangzhou Longqi received the ruling of Guangzhou intermediate people’s Court on December 23, which confirmed that the implementation of the company’s reorganization plan was completed and terminated its bankruptcy reorganization proceedings.
Guangzhou Longqi said that by implementing the reorganization plan, the legitimate rights and interests of all creditors were effectively protected, the asset liability structure of the company was improved, the sustainable operation and profitability were enhanced, and the company returned to a benign development track. In the future, the company will continue to do a good job in the production and operation of green daily chemicals and healthy food, strengthen the reform of subsidiaries, gather main businesses, optimize resource allocation and make every effort to improve the operating efficiency of the company.
(China Securities Journal)
