Shenzhen Daimai was accused of financial fraud and many executives were publicly criticized!

Recently, the Shenzhen Stock Exchange issued three disciplinary sanctions to a large seller: public condemnation, public determination of inappropriateness, and criticism through a notice.

The disciplinary document shows that Cross-border Tongbao E-Commerce Co., Ltd. (hereinafter referred to as: *ST Cross-border) had false financial disclosures, and the relevant parties failed to perform their duties and fulfill their obligations of integrity and diligence, violating the regulations of the Shenzhen Stock Exchange. The Shenzhen Stock Exchange has imposed three disciplinary measures on it.

The first item is to impose a public condemnation on *ST Cross-border; the second item is to impose a public condemnation on Xu Jiadong, the then chairman, general manager, chief financial officer (concurrently) and secretary of the board of directors (concurrently) of *ST Cross-border, and publicly determine that he is not suitable to serve as a director, supervisor or senior manager of a listed company within 10 years; the third item is to impose a notice of criticism on Zheng Tingying and Sun Junying, the then independent directors of *ST Cross-border, Yang Jianxin, Zhou Chunyan, Li Jie, and An Xiaohong, the then chief financial officer.

It was found that the specific financial disclosure violations of *ST Cross-border were that its subsidiary Global Easy Buy had falsely transferred current accounts into inventory, failed to handle sales expenses, cross-period logistics expenses, and fixed asset losses in 2020 and previous years. The net profit attributable to shareholders of the listed company in 2020 was -3.374 billion yuan and -2.060 billion yuan before and after the correction, respectively, with a false amount of 1.314 billion yuan. This violated the provisions of the Shenzhen Stock Exchange's "Stock Listing Rules (Revised in 2020)", and therefore was publicly condemned and criticized.

In fact, in recent years, *ST Cross-border has fallen into a poor management situation. Judging from the financial reports of *ST Cross-border over the years, its total operating income began to decline in 2018. At the same time, it suffered huge losses in 2019 and 2020. Its net profit only began to return to positive in 2021.

According to information from the Shenzhen Stock Exchange, this is not the first time that *ST Cross-border has been publicly condemned and criticized. In the past three years, *ST Cross-border has been publicly condemned and criticized many times. Two of them were due to false financial disclosures, and three were due to violations of stock reduction and stock repurchase.

Relatively speaking, this is the most severe punishment the Shenzhen Stock Exchange has ever imposed on it, especially the further escalation of the punishment on the main personnel involved. Therefore, listed sellers still need to bear in mind the obligation to perform their duties and fulfill their obligations to operate in good faith, otherwise they will be repeatedly testing the edge of danger and will eventually be punished.

Shenzhen big seller

*ST Cross-border