Recently, the China Securities Regulatory Commission has discovered that a small number of listed companies in certain regional equity markets engage in illegal fundraising activities such as selling or transferring "original shares" to the public. Criminals are keenly aware of the wealth growth needs of investors, and they illegally raise funds through means such as "primitive stocks", seriously disrupting China's financial management order and the legitimate rights and interests of investors.
How is the scam carried out? How can investors avoid being deceived? Let's uncover together in this issue.
What is the "original stock" scam?
Original shares, as the name suggests, refer to stocks issued before a company goes public and can be sold after a certain period of time. They are a special form of stock and do not have the ability to be publicly offered.
In the Chinese securities market, "primitive stocks" have always been synonymous with wealth, and many individuals who enjoy freedom of wealth have achieved it through primitive stocks. As a result, companies engaged in illegal fundraising use high returns as bait, making investors yearn for overnight wealth when they hear about primitive stocks. However, in reality, there is never such a thing as a pie in the sky, and those who want to sit back and enjoy the benefits may be more likely to be deceived and lose everything.
These criminals and legal representatives take advantage of investors' enthusiasm for "original stocks" to maliciously confuse the concept of "newly signed stocks" in the Shanghai and Shenzhen stock markets, as well as the concepts of listed companies, non listed companies, and non listed limited liability companies, and engage in "original stock" trading scams. These companies illegally absorb public deposits under the guise of securities investment, using high returns as bait and other pretexts such as "original stock subscription".
2. Real case studies to introduce you to "original stock" scams
Case 1: Unauthorized issuance of stocks, illegal fundraising at high interest rates
Guangdong Technology Development Co., Ltd. was established in 2011. In April 2014, the company was approved for listing and trading on a regional equity market in Guangdong. Afterwards, it held a "targeted capital increase and share expansion" press conference in a certain city.
The company claimed at the press conference that it is a high-tech leading enterprise specializing in wind power generation in China, with industries spread across the country, and completed its "listing" on a regional equity market in May of that year. The company also claims that the private placement funds raised through "equity crowdfunding" in this round will mainly be used to further develop related business for the enterprise. At the press conference, the company proposed the "Original Share Acquisition" plan: investors acquire a corresponding number of original shares by subscribing to "shares". Afterwards, based on the investment funds, payment will be made at a rate of 5 cents per month for a period of 3 natural months, with a commitment to an annualized return rate of 68% for the original stock investment, which is equivalent to 20 times the one-year bank deposit interest rate (approximately 2.25%). Once the news was released, it immediately sparked a frenzy of investors subscribing. According to relevant media reports, more than 500 people signed equity crowdfunding and private placement agreements at the press conference, and the company received approximately 100 million yuan. However, shortly after the press conference ended, the company experienced a redemption crisis. Two months later, the company 'ran away'.
Case 2: Clear on the surface, tempting behind the scenes
Investor Xiang saw a message about the transfer of original shares on a stock forum, and curiously clicked on the link below. The first thing that caught her eye was a very large "solemn declaration", which stated that "the company's listing work is proceeding in an orderly manner. Recently, it was discovered that an organic organization is transferring shares under the name of our company. Currently, the company only transfers the shares of the third largest shareholder, Ms. Jiang, and has not transferred any other shareholder shares..." This aroused Xiang's interest in further understanding this company.
After browsing the webpage, she called the company to inquire about how to purchase the original shares. Originally, it was just a simple inquiry, but when the company said that Ms. Jiang's shares had been transferred, she realized that she had missed the opportunity and felt very disappointed. So, when the company asked her to leave her phone number and inform her if any other shareholders transferred, she agreed without hesitation. Four days later, the company called to say that a new shareholder had sold the original shares, but the stock price was slightly higher and the quantity was not large. Ms. Xiang, who was eager to make money, ultimately spent 160000 yuan to buy 20000 shares.
After a period of time, Ms. Xiang found that the company website could no longer be accessed, but her original phone number had not been saved; Three months have passed and the website has not been opened, so she has to believe that she has been deceived.
III. Methods for Identifying "Original Stock" Scams
(1) Keep in mind the characteristics of "original stock" scams
1. Claiming that the company will be listed on domestic and foreign securities markets, enticing investors to purchase its stocks.
2. Claiming that the issuance of stocks has been approved by government departments, and even forging approval documents to deceive investors into purchasing their stocks.
3. Initiate the establishment of a joint stock company with investors in the name of issuing original shares.
4. In the name of capital increase or transfer of shares by major shareholders, raise funds or transfer stocks at a high price to unspecified individuals in society through public or disguised means such as advertising, letters, etc.
5. Illegally buying and selling, or acting as an agent for buying and selling stocks of unlisted companies to the public without approval under the names of "securities investment consulting companies" and "property rights brokerage companies".
6. Under the pretext of providing overseas listing services to domestic enterprises, some so-called foreign capital companies or investment companies' offices in China act as agents to buy and sell unlisted company stocks without approval.
7. The act of issuing stocks to unspecified entities without the approval of the China Securities Regulatory Commission, or issuing stocks to specific entities without the authorization of more than 200 shareholders.
(2) 4 anti fraud tips must be kept properly
1. If the issuance or transfer of stocks adopts public methods such as advertising, press conferences, briefing sessions, and the internet, it depends on whether it has obtained approval from the China Securities Regulatory Commission. If there is no approval document from the China Securities Regulatory Commission, it can be determined that the issuance of stocks is illegal;
2. Check whether intermediary agencies engaged in securities underwriting and agency buying and selling activities have obtained approval from the China Securities Regulatory Commission. Investors should subscribe to and transfer stocks in legal securities operating venues and institutions in accordance with the law;
3. Never believe in any "high returns". When investing in stocks, it is important to conduct a calm analysis to avoid being deceived;
4. When you encounter problems with unclear judgment, you can consult the local securities regulatory department in a timely manner.
Comprehensive content from New Financial Big Data, EastNet, Changsha Anti Illegal Publications Special Line
