Total Fines of 40 Million Yuan, Tianfeng Securities Receives Multiple Penalties! Two Regional Securities Regulatory Bureaus and Shanghai Stock Exchange Take Action Simultaneously, Former Chairman Banned from Market for Life, Suspended from Distributing Private Fund Products for 2 Years

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After the market close on March 13, Tianfeng Securities (601162.SH) received multiple fines. According to the announcement, Tianfeng Securities received several administrative penalty decisions, regulatory measures, and disciplinary sanctions from the Hubei Securities Regulatory Bureau, Fujian Securities Regulatory Bureau, and the Shanghai Stock Exchange on that day, totaling over 40 million yuan in fines.

The Hubei Securities Regulatory Bureau found that between 2020 and 2022, Tianfeng Securities illegally provided financing and engaged in information disclosure violations for the former largest shareholder, Wuhan Contemporary Technology Industry Group Co., Ltd. (hereinafter “Contemporary Group”). The bureau fined Tianfeng Securities 15 million yuan, and five responsible individuals were fined a total of over 20 million yuan. Former Chairman Yu Lei and former Vice President Xu Xin were permanently banned from the market.

The investigation by the Hubei Securities Regulatory Bureau revealed that Tianfeng Securities provided financing to Contemporary Group using its own funds. From 2020 to 2022, at the request of Contemporary Group, the company transferred funds through subsidiaries, designated investment rescue projects, purchased bonds of Contemporary Group through private equity funds, and engaged in reverse repurchase operations in its proprietary trading department, providing a total of 5.502 billion yuan in financing to Contemporary Group.

Of this amount, Tianfeng Securities has recovered 5.253 billion yuan, and the remaining 249 million yuan has been claimed through the bankruptcy administrator or the court overseeing Contemporary Group.

Tianfeng Securities also provided 1.012 billion yuan in financing for Contemporary Group using client assets under management, purchasing bonds of Contemporary Group in the primary market, and conducting reverse repurchase agreements with two private equity funds, providing 492 million yuan and 1.52 billion yuan respectively.

Additionally, the Hubei Securities Regulatory Bureau found that some employees promoted financial products not sold through the company’s distribution channels, leading to a two-year suspension of its private fund distribution business. Tianfeng Tianrui Investment Co., Ltd., a subsidiary, was found to have exceeded its business scope, operated some private fund products improperly, and issued private bonds outside the market, resulting in a one-year suspension of new private fund product approvals.

On March 13, Tianfeng Securities was also penalized by the Fujian Securities Regulatory Bureau for failing to disclose changes in holdings of Yong’an Forestry (000663.SZ) in a timely manner, with a fine of 4 million yuan. The company’s then President, Wang Linjing, was fined 1.4 million yuan.

According to the Shanghai Stock Exchange penalty decision, the SSE publicly reprimanded Tianfeng Securities and five responsible persons, including Yu Lei, Wang Linjing, and Xu Xin. It also publicly determined that Yu Lei and Xu Xin are permanently unfit to serve as directors, supervisors, or senior managers of securities issuers.

Regarding these penalties, Tianfeng Securities stated that the company sincerely accepts regulatory sanctions and will resolutely implement all decisions. This marks the thorough resolution of historical risks, with comprehensive rectification work firmly in place. Currently, operations are stable and orderly, and the company is entering a new stage of steady development.

In terms of performance, Tianfeng Securities expects to achieve a net profit attributable to the parent of 125 million to 185 million yuan in 2025, turning losses into profits.

(This article does not constitute any investment advice. Investment risks are assumed by the reader.)

Editor: Tao Yueyang

Sources include Securities Times, First Financial, 21st Century Business Herald, and others.

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