HLSY(SZ:000622) Shang Hai Zheng Quan Bao·2025-11-21 18:43Core Viewpoint - The regulatory authority maintains a "zero tolerance" stance towards violations in the capital market, emphasizing that delisting does not equate to immunity from penalties [1][8]. Group 1: Regulatory Actions - On November 21, the Hunan Securities Regulatory Bureau issued a notice of administrative penalty to Hengli Industrial Development Group Co., Ltd. (referred to as "Hengli Industrial" or "R Hengli 1") and 19 related individuals, proposing a total fine of 39.4 million yuan [1][6]. - Hengli Industrial has been subjected to two investigations by the regulatory authority due to suspected violations of financial data disclosure [1][7]. Group 2: Financial Misconduct - Hengli Industrial inflated its revenue through fictitious transactions in ethylene glycol trading, resulting in inflated revenues of approximately 227 million yuan, 181 million yuan, 135 million yuan, and 51.19 million yuan from 2020 to the first half of 2023, representing 74.24%, 52.27%, 55.08%, and 47.77% of the reported revenues for those periods [2][4]. - The company also inflated its costs by approximately 220 million yuan, 175 million yuan, 132 million yuan, and 49.41 million yuan during the same periods, constituting 77.53%, 53.9%, 55.45%, and 50.43% of the reported costs [2][4]. Group 3: Accountability of Executives - The investigation identified five key executives, including the former chairman and president, as directly responsible for the violations related to financial disclosures [4][5]. - Additional executives, including the former financial director and other board members, were also implicated for failing to exercise due diligence regarding the abnormal trading activities [5][6]. Group 4: Consequences and Future Implications - The regulatory authority plans to impose an 8 million yuan fine on Hengli Industrial and a total of 31.4 million yuan in fines on the 19 responsible individuals, with some facing market bans of 3 to 5 years due to the severity of their violations [6][7]. - The case serves as a precedent, reinforcing the message that delisting does not exempt companies from accountability, and it highlights the ongoing commitment to investor protection even after a company has been delisted [8][9].