Case Study of "Investor Protection, Clear Rules and Risk Recognition": Watch out for "Fraudulent" Information Disclosure of Listed Companies

 

In the stock market, hot topic stocks may indicate that the company has potential prospects for development and upward space in the future, and are often highly sought after by investors. Many listed companies will also expand new development space and tap greater development potential through business transformation and asset restructuring. However, some listed companies mislead investors by disclosing untrue and inaccurate information and exaggerating the impact of related business on the company with the help of the hot topic "bubbles", thus causing investors to follow suit. Little did they know that there was only a vague vision behind it.

 

N Company has painted such a castle in the air for investors. Before 2014, the business scope of N Company is mainly software development and service business and credit risk business management consulting. Since May 2014, N Company has disclosed a series of related information about Internet financial business, including data service, credit information service and small loan cloud service. X Internet Financial Company has been established in cooperation with a commercial bank to carry out Internet financial related business. It is proposed to establish Z Network Information Co., Ltd. to engage in inclusive financial related business. As soon as this information comes out, major investment institutions are optimistic, small and medium-sized investors follow the trend to buy, making the share price of N company up to 16 times in a year.

 

But in fact, behind such a grand financial picture of the Internet is only a vision of uncertainty. N company's actual Internet finance related business income is very small, accounting for only 0.62% of the main business income. The company's development strategy related to Internet finance has never been submitted to the board of directors and the board of directors'Strategic Development Committee for consideration. There are no relevant work plans, no plans for funding sources, no substantive progress in related business, and related projects have been suspended for violation of policies. Moreover, the information disclosed by the company is one-sided, selective disclosure of good information, circumvention of adverse information, and the problems and progress of the above-mentioned business are not disclosed. The Internet financial business claimed by N Company is only a description and imagination of the future, lacking the corresponding factual basis and minimal realizability in the future. However, it makes investors mistake it as mature and misleading.

 

Coincidentally, D company also draws a good vision as an investor through the theme speculation. D company makes use of the hotspot of Internet Finance speculation. While the company's Internet financial website is being prepared and has not yet started to operate, it announces that it can "make the company in the leading competitive advantage in the Internet financial industry", exaggerates and exaggerates the impact on the company's business, misleads investors and makes them do so. Making wrong investment decisions. After that, the company's stock price rose and stopped for 6 consecutive days, up 77.37%.

 

When a listed company undergoes major changes in its operating principles and scope, or major investment actions and decisions on major purchases of property, it shall disclose information truthfully, accurately and completely, stating the causes, current status and possible legal consequences of the event. If the facts are unrealistically exaggerated or information is disclosed selectively, the information asymmetry between listed companies and investors will be caused, and investors will easily rely on information to make wrong investment decisions. This violates the relevant provisions of the Securities Law that listed companies must disclose information truthfully, accurately and completely, and must not have false records, misleading statements or major omissions, and violates the open, fair and just order of market transactions. What's more, some listed companies use storytelling to drive stock prices to rise, which paves the way for high prices to reduce stock holdings. This kind of behavior that infringes on the interests of small and medium-sized investors for their own benefit is the object of severe attack by the capital market.

 

Faced with the hot information disclosed by listed companies, investors should keep their eyes open when investing in stocks. They should not be confused by the hot topics of listed companies. Instead, they should comprehensively analyze the true accuracy of relevant information in the light of macro-policies, industrial conditions and the actual situation of enterprises, and evaluate the impact of relevant business on the company. Degree, rational judgment of the investment value behind it. At the same time, investors should be alert to the behavior of listed companies by telling stories "blowing bubbles" to preheat their high prices. Otherwise, once the bubble bursts and the stock price and value return to normal track, investors may face huge economic losses.