East Group Co.,Ltd. Investors Receive Compensation in Securities Fraud Case

Investors who suffered losses can register their claims on the Sina investor rights protection platform.

In early February 2026, significant progress was made in the investor compensation case against East Group Co.,Ltd. concerning false statement violations. Represented by attorney Xu Feng from Shanghai Jiucheng Law Firm, the case has seen some investors receive compensation payments. A portion of the claims have been resolved through settlement, with compensation being paid out, and the cases are now entering the closing phase.

Attorney Xu Feng indicated that prior favorable court judgments had already been secured for investors in the East Group case. On February 4, 2026, Attorney Xu filed another batch of cases with the court on behalf of investors. His legal team is concurrently advancing the filing of subsequent cases and continues to accept new mandates from other affected investors.

On the evening of December 31, 2024, East Group announced that it had received the "Administrative Penalty Decision" from the China Securities Regulatory Commission (CSRC). The investigation found that the company had committed the following illegal acts: 1. Inflated operating revenue, operating costs, and total profit by engaging in fictitious trade businesses. 2. Inflated operating revenue and operating costs through procurement agency businesses and acting agency businesses that possessed financing characteristics. 3. Inflated operating revenue and operating costs through data center integration businesses that possessed financing characteristics.

In summary, by engaging in the aforementioned fictitious trade businesses, financing-based procurement agency businesses, agency businesses, and data center integration businesses that lacked commercial substance, East Group inflated its operating revenue, operating costs, and total profit. This led to false records in the annual reports disclosed by the company from 2017 to 2021.

Attorney Xu Feng, specializing in securities litigation, believes that based on the previous favorable judgments and successful compensation cases, investors who purchased East Group stock between March 15, 2018, and May 12, 2023, and sold or continued to hold the stock after May 12, 2023, may still be eligible to file claims.