China Securities Regulatory Commission Decides To File A Case Against Lu Keping

Recently, three listed companies, Jiangsu Sunshine, Sihuan Biology and Weichuang Co., Ltd., collectively issued announcements pointing to the same name - Lu Keping. The announcement shows that the CSRC decided to file a case against Lu Keping due to suspected violations of information disclosure laws and regulations.

This capital tycoon in the industry, known as the "giant of wool spinning", was filed at the age of 79, just over two years after he was banned from entering the market for life.

Holding a number of listed companies, he was once a "frequent visitor" on the rich list

Lu Keping, who created the "Sunshine System", is currently the indirect controlling shareholder of Jiangsu Sunshine, the actual controller of Sihuan Biology, and the upper shareholder of Vetrone.

To count Lu Keping's past, he started from industry and later "loved" the capital market, but he also "failed" in the capital market.

According to public data, Lu Keping was born in Xinqiao Town, Jiangyin City, Jiangsu Province in 1944. At the age of 20, he joined the social education team of Jiangyin Xinqiao Commune in Jiangsu Province. Later, after several twists and turns, from village run enterprises to construction stations, he became the deputy secretary of the Party branch of Jiangyin Fine Wool Textile Factory in 1979. Seven years later, he was 42 years old when he became the secretary of the Party branch of Jiangyin Fine Wool Textile Factory and concurrently served as the factory director.

In 1993, Jiangyin worsted mill was restructured and established Sunshine Group and a series of related companies. Lu Keping also became the chairman of the company.

According to media reports, since then, Jiangsu Sunshine Group has developed into the world's largest wool textile production enterprise and high-end clothing production base, and is also the only enterprise in China's textile industry that has won the honor of "world famous brand". For this reason, Lu Keping is known as the "wool textile giant".

In 1999, at the age of 55, Lu Keping ushered in the highlight of his life and landed in the capital market with Jiangsu Sunshine. This also helped Lu Keping earn a lot of money. Lu Keping ranked 124th in the Hurun Top 100 Rich List in 2005 with a wealth of 1.4 billion yuan, and has also been on the rich list for many times since then.

Lu Keping, who has accumulated rich funds, chose cross-border development, realized a large amount of cash from Hairun PV through capital operation, and became the back controller after being incorporated into Bureau Sihuan Biology.

However, "there is no way not to wet his shoes when walking along the river". Lu Keping, who has frequently increased his shareholding in listed companies through close relatives and obtained the control of Sihuan Biotech for many years, was investigated by the CSRC.

In 2020, Lu Keping was banned from entering the market for life by the CSRC and fined 27.34 million yuan for falsely recording the information of the controller, failing to disclose related party transactions as required, and limiting the trading of company shares within the trading period.

But Lu Keping did not fade out of the capital market. On the evening of October 9, 2023, Sihuan Biology and Jiangsu Sunshine announced that Lu Keping was suspected of manipulating the securities market in violation of laws and regulations, and the CSRC decided to file a case against him.

What is unexpected is that in the past two months, Lu Keping has been put on file again recently for suspected information disclosure violations.

Or related to the "strange disappearance" of 1.33 billion yuan

Jiangsu Sunshine and Sihuan Biology mentioned in the announcement that the matter that Lu Keping was investigated has nothing to do with the company. In the announcement, Vetrone said that during the investigation, the company will actively cooperate with the CSRC in the investigation and perform the obligation of information disclosure in strict accordance with the regulatory requirements. According to the market analysis, this "capital tycoon" who has been riding the capital market for more than 20 years may be investigated due to the case of Wintron.

On the evening of the 22nd, Vetrone issued several announcements in succession. In addition to disclosing that it was filed by the CSRC for suspected information disclosure violations, it also said in a self inspection announcement that on September 20, the limited partner of several controlling shareholders of the company, Monsas (Taizhou) Jiangsu Sunshine Group Co., Ltd., the controlling shareholder of the Investment Co., Ltd., signed the Equity Transfer Cooperation Framework Agreement with Jiangxi Xiling Energy Co., Ltd. (hereinafter referred to as "Xiling Energy"). According to the arrangement of the agreement, Xiling Energy will acquire the control of Zhongshuweike through the investment relationship in the next 12 months.

However, it is strange that the self inspection announcement mentioned that Liu Jun, the actual controller of Xiling Energy, the proposed acquirer, transferred 1.33 billion yuan of capital of Vetrona shares to the bank account under its control through the jointly managed bank account from September 28 to October 27, 2023, and returned the shares of Vetrona in full on October 31, but transferred them out in batches from November 1, As of December 22, the funds had not been returned to Vetrona.

Since then, the 1.33 billion yuan capital of Vetrona has been "strangely missing". What's more strange is that the reporter of Zhongxin Finance and Economics searched for "Jiangxi Xiling Energy Co., Ltd." in the national enterprise credit information system and found no relevant information. Among the shareholders of Jiangxi Xiling Energy Co., Ltd. with similar names, there was no Liu Jun.

According to the disclosure of Weichuang Shares on the 22nd, Liu Jun, the proposed acquirer of Weichuang Shares, was also put on the record by the CSRC due to suspected violations of information disclosure laws and regulations.

In view of the seriousness of the matter, Shenzhen Stock Exchange also promptly issued an Inquiry Letter on the 22nd, requiring Vetrona to take all necessary measures to recover relevant funds, safeguard the interests of the company and minority shareholders, and carefully self inspect and rectify the defects in internal control.

The reporter from Zhongxin Finance and Economics noticed that Lu Yu, who is now the chairman of Vetrone, is the son of Lu Keping, who has also been investigated. In recent years, father and son took over their duties. In June this year, Lu Keping also planned to transfer 66.7925% of the equity of Jiangsu Sunshine Holding Group Co., Ltd. to Lu Yu. In addition, according to the disclosure of Vetrone, the actual controller of Jiangsu Sunshine Group Co., Ltd. who signed an agreement with Xiling Energy is Lu Keping.

In addition to the "missing" of 1.33 billion yuan, in recent months, the independent directors and senior executives of Vetrona also left in a centralized manner. On the evening of November 25, Vetrone released an announcement that it received the resignation report from Secretary of the Board of Directors Zhang Shuhan on November 3, 2023, and the resignation report from independent director Zhang Wendong on November 30, 2023. Recently, it received the resignation reports from financial principals Wen Jingjing, independent directors Gao Zhiping, and Geng Zhijian.

According to the previous disclosure of Vetrone, the Secretary of the Board of Directors Zhang Shuhan and the Financial Principal Wen Jingjing were both appointed on October 13 this year. This also means that as of the resignation date, Zhang Shuhan has been in office for less than one month and Wen Jingjing has been in office for less than three months.

It is worth mentioning that before Zhang Shuhan and Wen Jingjing were appointed, Vetrone shares had just ushered in a wave of "resignations" of directors, board secretaries and senior managers of the company.

It is unknown to the outside world what happened inside Vetrone. However, this time Vetrone and Lu Keping were investigated together, and the father and son were "sad at the end of the year".