On September 7, 2026, Suzhou Kohler Decoration Co., Ltd., listed under the ticker 603828 and known as *ST Leader (603828), announced that it, along with several responsible individuals, had received a prior notification of administrative penalties from the Jiangsu Regulatory Bureau of the China Securities Regulatory Commission (CSRC). As the administrative penalty process advances, claims for compensation from investors who suffered losses due to the company's information disclosure violations have officially begun.
According to the facts established in the penalty notice, *ST Leader committed serious violations in its information disclosure practices. Between January 2020 and December 2022, the company and its subsidiaries transferred funds, totaling approximately 1.7028 billion yuan, to accounts of controlling shareholder Kohler Group and related parties headed by actual controller Gu Yiming. These transfers were conducted under the guise of labor or engineering advance payments without genuine business substance, channeled through multiple intermediaries, resulting in non-operational fund embezzlement by related parties. Furthermore, the company's annual report for 2024 and semi-annual report for 2025 contained false records regarding the fund embezzlement situation, which did not align with actual circumstances. The company failed to disclose these related-party transactions in a timely manner and did not accurately report them in its annual reports from 2020 to 2023, leading to major omissions in its periodic statements. Although the funds were eventually repaid with interest by the end of April 2026, the operational damage and stock price collapse inflicted on the company have proven irreversible.
In response to these violations, the Jiangsu Regulatory Bureau intends to impose severe penalties on the company and its responsible individuals, with total fines reaching 38.4 million yuan. The dire state of the company today illustrates the devastating impact of the 1.7 billion yuan misappropriation. According to public announcements, *ST Leader reported revenue of only 414 million yuan in the first half of 2026, a sharp decline of 53.86% year-on-year, with net losses exceeding 46 million yuan. The stock price has fallen dramatically from previous highs, causing substantial losses for investors who made purchases in 2023 and 2024 based on trust in the company's annual reports. Additionally, Kohler Decoration now faces the risk of delisting. Having received adverse opinion audit reports on internal control for two consecutive fiscal years (2024 and 2025), the company's shares have been placed under delisting risk warning (*ST). According to the relevant provisions of the Shanghai Stock Exchange Stock Listing Rules (April 2026 revision), if the company fails to meet the conditions for lifting the delisting risk warning, its stock faces the risk of being terminated from listing.
Under the Securities Law and related judicial interpretations, investors who suffered losses due to misrepresentation can file lawsuits for compensation once the CSRC issues penalties. The legal team from Shanghai Huzi Law Firm, led by lawyer Liu Peng, has already submitted a first batch of cases to the courts for filing. Based on the preliminary penalty, the compensation claim conditions have been revised to cover investors who purchased shares between December 12, 2023, and April 28, 2024, and sold or continued to hold those shares at a loss after April 29, 2024. Investors should note that final claim conditions will be determined by effective court judgments.
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