Core Viewpoint - The company Sichuan Medical Technology Co., Ltd. (思创医惠) is under criminal investigation for financial fraud related to previous fiscal years, following a notification from the Hangzhou Public Security Bureau [1][3][4]. Group 1: Investigation and Legal Actions - The investigation pertains to allegations of fraudulent issuance of securities, with the company required to provide relevant evidence [1][4]. - The investigation is a continuation of prior administrative penalties imposed by the Zhejiang Securities Regulatory Commission, which found the company had inflated revenues and profits through false business activities [5][6]. - The company has stated it will cooperate with the investigation and is currently in discussions regarding potential compensation for affected investors [7]. Group 2: Financial Performance and Adjustments - In 2024, the company reported revenues of approximately 690.77 million yuan, a decrease of 31.33% from the previous year, while the net loss attributable to shareholders was approximately 501.51 million yuan, a reduction in loss of 42.64% compared to 2023 [10][11]. - The company has undergone significant structural changes, including the resignation of its former chairman and a shift in control to new shareholders linked to the Cangnan County Finance Bureau [8][9]. - The company has divested its core business in smart healthcare, selling its subsidiary for 300 million yuan, and is now focusing on the Internet of Things (IoT) sector as part of its strategic pivot [9][10]. Group 3: Regulatory Environment - Recent trends indicate an increase in criminal accountability for financial fraud among listed companies, with regulatory bodies intensifying their oversight and enforcement actions [11].

Core Viewpoint - Sichuang Medical's involvement in financial fraud has led to criminal investigations, with the company cooperating with authorities during the ongoing inquiry [1][3][4]. Group 1: Investigation and Legal Actions - Sichuang Medical received a notice from Hangzhou Public Security Bureau regarding evidence collection for a fraud case related to securities issuance [1]. - The investigation focuses on past financial records and is linked to previous administrative penalties imposed by the Zhejiang Securities Regulatory Commission [3][4]. - The company was previously found to have inflated revenue and profits significantly, with a cumulative revenue inflation of 34.93 million yuan and profit inflation of 33.02 million yuan in 2019, representing 20.03% of total profit for that period [4][5]. Group 2: Financial Performance and Adjustments - In 2024, Sichuang Medical reported revenues of 690.77 million yuan, a decrease of 31.33% from the previous year, while the net loss was 501.51 million yuan, a reduction in losses by 42.64% compared to 2023 [9][10]. - The company has undergone significant restructuring, including the resignation of its former chairman and the sale of its subsidiary, which was the main platform for the fraudulent activities, for 300 million yuan [7][8]. - Following the divestment, the company aims to focus on the Internet of Things (IoT) business, shifting its growth strategy to "focus on IoT, reshape growth engines" [8]. Group 3: Regulatory Environment and Future Outlook - The recent increase in criminal accountability for financial fraud in the industry is highlighted by the Supreme Court and the China Securities Regulatory Commission's joint guidelines aimed at enhancing regulatory scrutiny and penalties for fraudulent activities [10]. - Sichuang Medical is actively engaging with investors regarding potential compensation plans and is committed to fulfilling its legal responsibilities [6].