Guizhou Bailing Group Pharmaceutical Co.,Ltd. (002424) Faces Regulatory Action Over Years of Financial Fraud

Deep News12-19

Guizhou Bailing Group Pharmaceutical Co.,Ltd. (002424) announced on December 19 that the company and related parties received a prior notice of administrative penalties from the Guizhou Securities Regulatory Bureau. The notice revealed that the company’s annual reports for 2019, 2020, 2021, and 2023 contained false financial records. Trading of the company’s shares will be suspended for one day starting December 22, and upon resumption on December 23, the stock will be subject to special treatment (ST), with its ticker symbol changing from "Guizhou Bailing" to "ST Bailing."

The Guizhou Securities Regulatory Bureau has issued prior notices of administrative penalties and market entry bans against Guizhou Bailing for suspected financial misrepresentation in periodic reports.

Investigations found that the company failed to recognize sales expenses on an accrual basis in accordance with the matching principle of revenue and costs, leading to underreported sales expenses from 2019 to 2021, cumulatively inflating profits by 654.726 million yuan. In 2023, the company overstated sales expenses, reducing reported profits by 459.411 million yuan.

For its years of financial fraud, a severe violation of securities laws, the regulator plans to order corrective actions, issue warnings, and impose a fine of 10 million yuan on Guizhou Bailing. Additionally, 10 responsible individuals, including Jiang Wei, will face warnings and combined fines of 15.6 million yuan. Jiang Wei is also subject to a 10-year ban from the securities market.

Financial fraud severely undermines market fairness and investor rights. The Guizhou Securities Regulatory Bureau emphasized its commitment to strict enforcement, targeting major violations, key figures such as actual controllers and executives, and gatekeeper intermediaries to ensure market integrity.

Guizhou Bailing is a pharmaceutical company specializing in Miao ethnic medicine R&D, production, and sales. Its key products include Yindan Xinnaotong Soft Capsules, Kesuting Syrup and Capsules, Yizhihuanghua Spray, and non-Miao medicines like Jingan Capsules and WeC Yinqiao Tablets.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment