Investor compensation cases related to false statements by Caissa Tosun Development Co.,Ltd. (000796) have established successful precedents, with further litigation opportunities remaining for affected investors.
On September 28, 2024, Caissa Tosun Development Co.,Ltd. (000796) announced receipt of an Administrative Penalty Decision from the Hainan Securities Regulatory Bureau. The investigation revealed the following violations by Caissa Tongsheng:
During the period in question, Caissa Shijia Tourism Management Consulting Co., Ltd. (hereinafter referred to as "Caissa Shijia") served as the controlling shareholder of Caissa Tongsheng. Beijing Beijiatu Travel Agency Co., Ltd. and 17 other enterprises, along with Caissa Shijia and Caissa Tongsheng, met the criteria specified in Article 71, Item 3 of the Listed Company Information Disclosure Management Measures issued in 2007 (CSRC Order No. 40), Article 62, Item 4 of the Listed Company Information Disclosure Management Measures issued in 2021 (CSRC Order No. 182), and Article 3, Paragraph 1 of Enterprise Accounting Standards No. 36 - Related Party Disclosures. Consequently, Caissa Shijia, Beijiatu, and the other 18 companies constituted related parties of Caissa Tongsheng.
From January 2020 to December 2022, Caissa Tongsheng engaged in non-operational fund occupation with Caissa Shijia and its related parties through various forms including fund lending, receivables collected by related parties, payment of expenses on behalf of related parties, entrusted loans, equity investments and prepayments without genuine commercial background, and factoring loans. By the end of December 2023, Caissa Tongsheng had completed rectification of these fund occupation situations.
1. Failure to Timely Disclose Non-operational Fund Occupation by Related Parties
The investigation found that in 2020, Caissa Tongsheng's non-operational fund occupation with Caissa Shijia and its related parties amounted to RMB 1.859 billion, representing 71.81% of the most recent audited net assets. In 2021, the non-operational fund occupation reached RMB 2.388 billion, representing 184.72% of the most recent audited net assets. In 2022, the non-operational fund occupation amounted to RMB 829 million, representing 185.68% of the most recent audited net assets.
2. Material Omissions in Related Periodic Reports
The investigation revealed that from January to June 2020, Caissa Tongsheng's non-operational fund occupation with Caissa Shijia and its related parties amounted to RMB 1.218 billion, representing 47.38% of the net assets recorded in the period report. From January to December 2020, the non-operational fund occupation reached RMB 1.987 billion, representing 153.71% of the net assets recorded in the period report. From January to June 2021, the non-operational fund occupation amounted to RMB 1.438 billion, representing 127.77% of the net assets recorded in the period report. From January to December 2021, the non-operational fund occupation reached RMB 2.388 billion, representing 534.79% of the net assets recorded in the period report. From January to June 2022, the non-operational fund occupation amounted to RMB 813 million, representing 220.40% of the net assets recorded in the period report.
3. Material Omissions in "17 Caesar 03" Bond-Related Periodic Reports
In 2017, Caissa Tongsheng publicly issued corporate bonds "17 Caesar 03" to society, raising RMB 700 million.
According to regulations, during the existence period of "17 Caesar 03" bonds, Caissa Tongsheng should have fully disclosed the aforementioned non-operational fund occupation with its controlling shareholder and related parties. However, the company failed to disclose this information in its 2020 semi-annual report, 2020 annual report, 2021 semi-annual report, 2021 annual report, and 2022 semi-annual report as required.
Based on the comprehensive information above and securities law provisions, investors who purchased Caissa Tosun Development Co.,Ltd. shares between January 8, 2020, and September 5, 2023, and sold or continue to hold shares after September 5, 2023, may still initiate compensation claims.
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