Core Viewpoint - Tonghui Information has been found to have engaged in financial fraud for several years prior to its listing on the Beijing Stock Exchange, with its actual controller, Dai Fuhao, being criticized for the severity of the misconduct. Following its listing, the company has faced continuous losses, and funds have been misappropriated by Dai Fuhao. The company is now facing withdrawal of investment from strategic partner Nantian Shujin, raising concerns about the future of the company and the protection of minority shareholders' interests [1][3][8]. Group 1: Financial Fraud and Penalties - On October 17, Tonghui Information announced that it received an administrative penalty from the China Securities Regulatory Commission (CSRC) for financial fraud committed from 2018 to 2021, resulting in fines totaling 35.5 million yuan. The company was ordered to correct its actions and received a warning, while Dai Fuhao was fined 11.5 million yuan and banned from the market for ten years [1][5]. - The company inflated its revenue and profits through fictitious business contracts and premature or delayed revenue recognition, leading to false disclosures in its annual reports from 2018 to 2021. The inflated revenues were 20.17 million yuan, 9.617 million yuan, 14.976 million yuan, and 18.065 million yuan for the respective years, with corresponding profit inflation of 10.4643 million yuan, 8.1486 million yuan, 7.3748 million yuan, and 5.8782 million yuan [5][6]. Group 2: Financial Performance Post-Listing - After its listing on the Beijing Stock Exchange, Tonghui Information's financial performance deteriorated significantly, with revenues dropping from 567 million yuan in 2021 to 20.72 million yuan in 2024, and net profits turning from a profit of 26.17 million yuan in 2021 to losses of 71.94 million yuan in 2024. The first half of 2025 saw revenues decline by 78.66% year-on-year [3][4]. - The company reported a net loss of 14.39 million yuan and a non-recurring net loss of 14.30 million yuan in the first half of 2025, indicating a continued downward trend in financial performance [3][4]. Group 3: Management and Governance Issues - Dai Fuhao has been implicated in misappropriating company funds, with an average daily fund occupation of 38.27 million yuan in 2022, which was fully repaid by the end of the year. Additionally, the company faced a legal investigation by the CSRC for information disclosure violations [7][8]. - Following the company's financial troubles, strategic partner Nantian Shujin decided to withdraw its financial support of 41.95 million yuan due to ongoing interference in company operations by Dai Fuhao. The company currently has only 19.09 million yuan in available funds, facing significant financial pressure [8][12]. Group 4: Future Outlook and Shareholder Concerns - The ongoing conflict between Dai Fuhao and Nantian Shujin raises questions about the protection of minority shareholders' interests. The company is working on a plan to communicate with its actual controller and Nantian Shujin to negotiate payment extensions and avoid litigation risks [12][11]. - The company is also undergoing management changes and restructuring efforts to stabilize operations, but the internal conflicts and governance issues may hinder recovery efforts [11][12].