Securities Times reporter Cheng Dan
For a long time, the China Securities Regulatory Commission has always had “zero tolerance” for illegal activities in the capital market. In particular, it has continued to increase punishments for fraudulent issuances, market manipulation and illegal information disclosure, effectively purifying the capital market ecosystem. However, the problem of insufficient supply of the legal system still exists, and supervision and law enforcement still face institutional shortcomings. It is necessary to improve the legislative system and tighten the institutional cage to increase the deterrent against illegal activities in the capital market.
Luo Wei, a member of the National Committee of the Chinese People’s Political Consultative Conference, a member of the Central Legal Affairs Commission of the Democratic National Construction Association, and a first-level inspector of the Office of the Punishment Committee of the China Securities Regulatory Commission, is familiar with the punishment of illegal cases in the capital market. How to build a three-dimensional accountability system with “thorns and teeth”? How to implement the “investor-oriented” concept so that lawbreakers are too painful to dare to do anything? Luo Wei recently accepted an exclusive interview with a reporter from Securities Times.
Improve legislation
Increase the cost of illegal activities in the capital market
Securities Times reporter: The proposals you brought this year are related to your work. Please briefly introduce them?
Luo Wei: I brought two proposals this year. The first is a proposal to introduce a financial law to implement full coverage of financial supervision, and the second is a proposal to improve legal responsibilities to increase the cost of violating the law in the capital market.
Current financial supervision lacks a unified basic law. Supervision overlaps and supervision gaps exist at the same time. The financial legal system is not sound enough. National-level financial laws can be formulated to unify the basic supervision principles of the financial industry, promote effective connection and coordination of supervision, and improve The consistency of regulatory standards will improve the adaptability and forward-looking nature of financial legislation.
The second proposal is mainly derived from the experience and insights of engaging in securities law enforcement work. The current legal system still has insufficient supply, which is highlighted in three aspects: First, there is a lack of necessary legal regulations for third parties who cooperate with issuers and listed companies in financial fraud. Those who cooperate with counterfeiters have been outside the law for a long time and have escaped from the law. Sanctions; second, there are no direct provisions on the legal liability for illegal acts such as capital appropriation by major shareholders and actual controllers, illegal guarantees, and use of related transactions to infringe on the interests of listed companies. In practice, administrative liability can only be investigated illegally through information disclosure, which is “just scratching the surface.” It is suspected of “avoiding the important and taking the easy”, and it is difficult to pursue criminal liability; thirdly, there is a lack of legal provisions on administrative liability for the breach of commitments by shareholders and actual controllers of listed companies, which affects the effectiveness of supervision and law enforcement to a certain extent. Therefore, it is recommended that at the legislative level Special liability clauses are set up to fill in the legal shortcomings and ensure that supervision and law enforcement are “thorny” and sharp.
Securities Times reporter: In the past period, the long-standing low cost of securities violations has improved. Could you please introduce the relevant situation.
Luo Wei: From 2019 to 2023, the China Securities Regulatory Commission system made 1,940 administrative penalty decisions, a year-on-year increase of 77.98%; market ban measures were taken against 442 people, a year-on-year increase of 140.22%; the amount of fines and confiscations was 23.1 billion yuan, and we continued to consolidate and crackdown Administrative penalties for securities violations are high-pressure.
The first is to resolutely punish illegal activities such as financial fraud and fraudulent issuance, improve the quality of listed companies from the source, and consolidate the “gatekeeper” responsibilities of intermediaries. Second, we have consistently maintained a high-pressure crackdown on illegal trading activities, resolutely investigated and dealt with illegal trading activities such as insider trading and market manipulation, and maintained the stable operation of the market. The third is to crack down on illegal activities in key areas such as bonds and private equity to help prevent and resolve various risks and hazards.
Strictly investigate
Legal liability for illegal acts
Securities Times reporter: In the next stage, what areas will the capital market’s administrative penalties focus on?
Luo Wei: The China Securities Regulatory Commission will continue to maintain the main tone of “strict” administrative law enforcement. In its law enforcement work, it will grasp the elements of securities violations stipulated by law and strictly investigate the legal liability for illegal acts. Keep a close eye on illegal activities such as financial fraud, fraudulent issuances, and dereliction of duty by intermediaries, and severely punish them. Strengthen deterrence to help combat and prevent counterfeiting, and safeguard the stability and long-term progress of major reforms in the capital market; strictly regulate market manipulation, insider trading, and other behaviors Precise law enforcement helps maintain fair trading order and maintain the stable operation of the market; we keep a close eye on bond defaults, fake private placements, illegal securities business and other chaos, strictly rectify all kinds of chaos in the name of “innovation”, and resolutely curb major risks and hazards.
It should be pointed out that administrative penalties are only one link in the accountability chain for illegal acts, not the entire process. To build a three-dimensional accountability system with “thorns and tusks”, it is even more necessary to play the role of civil compensation and criminal accountability, so that investors can obtain “real money” compensation and those who test the law can “sit behind bars.” For example, after the Kangmei Pharmaceutical illegal information disclosure case was fined by the China Securities Regulatory Commission under the 2005 Securities Law, the China Securities Regulatory Commission actively supported investors in making civil claims based on the identified illegal facts. In the end, the investors were compensated 2.459 billion yuan, which not only cost them The counterfeiters “went bankrupt” and investors were compensated with “real money”. For another example, after Zhangzidao was administratively punished by the China Securities Regulatory Commission for counterfeiting in accordance with the law, the China Securities Regulatory Commission transferred clues to the public security organs for investigation of criminal responsibility. In the end, the then chairman was sentenced to 15 years in prison, which fully demonstrated the deterrent effect of punishment and achieved the goal of putting the counterfeiters behind bars. Sit through”.
The next step is to continue to strengthen the supervision and enforcement work of the China Securities Regulatory Commission and continuously improve the effectiveness of law enforcement, especially to increase the investigation and punishment of illegal activities such as financial fraud and market manipulation, so as to provide a good foundation for subsequent civil compensation and criminal accountability. The second is to promote the revision of laws and the promulgation of judicial interpretations, improve the accountability mechanism, and increase accountability. For example, the breach of trust that harms the interests of listed companies involved in the proposal is currently stipulated in the criminal law. However, in practice, few criminal sentences have been issued based on this article, making it difficult to implement. It is necessary to “activate” this provision through the issuance of judicial interpretations. . At the same time, we recommend adding new administrative liability clauses to the administrative legal system for breach of trust that harms the interests of listed companies, so as to build an orderly and smooth legal liability system. The third is to implement the investor-oriented concept and, on the basis of existing successful cases, continuously improve and optimize systems such as civil settlement, advance compensation, and administrative law enforcement party commitments, and comprehensively use a variety of methods to punish illegal activities and reduce the cost of investor rights protection. , enhance investors’ sense of gain and security.
perfect investor
Compensation and relief system mechanism
Securities Times reporter: In the next stage, what regulatory measures will the China Securities Regulatory Commission take to implement the “investor-oriented” concept?
Luo Wei: On the basis of administrative accountability, the China Securities Regulatory Commission will continue to actively support criminal justice and civil compensation work, and continue to increase the linkage with public prosecutors and judicial organs.
First, increase the intensity of criminal accountability and improve the efficiency of criminal accountability, further leverage the institutional advantages of the public security and procuratorate agencies stationed at the Securities Regulatory Commission, strengthen the cooperation of the law enforcement and judicial systems, enhance the joint force in combating securities crimes, increase the implementation rate of criminal cases, and effectively play the role of criminal penalties. Deterrent effect and increase the cost of violating the law.
The second is to increase the investigation of civil liability, actively promote the Supreme People’s Court to formulate a criminal judicial interpretation of the crime of breach of trust and harming the interests of listed companies, and strengthen the crackdown on the breach of trust by controlling shareholders and actual controllers of listed companies. On the basis of implementing the judicial interpretation of civil compensation for false statements, we should improve the civil liability system with commensurate penalties and intensify the investigation of civil liability for the “chief culprits”.
The third is to improve the investor compensation and relief system mechanism, improve the advance compensation implementation system, improve the normal operation mechanism of representative litigation in securities disputes, coordinate the use of a series of investor compensation and relief system mechanisms such as support for litigation, administrative law enforcement and party commitments, and further give full play to investment services. The center plays a role in subrogation litigation and strengthens investor protection.
Securities Times: What other important tasks will the Administrative Punishment Committee Office of the China Securities Regulatory Commission have this year?
Luo Wei: First, adhere to “zero tolerance” and always maintain the main tone of “strict” administrative law enforcement. Make full use of legal authorizations such as the Securities Law and the Fund Law, and severely crack down on various illegal activities in accordance with the law. Take multiple measures to improve law enforcement effectiveness and respond to market concerns in a timely manner. The second is to anchor “high quality” and achieve strict standards, fair and civilized law enforcement. We will continue to strengthen the construction of the rule of law in the capital market, weave a tight system of administrative penalty rules and regulations, and grasp the constituent elements of securities violations stipulated by law, so that excessive punishments are proportionate and no punishment is in vain. The third is to adhere to the investor-oriented law enforcement concept and promote the establishment of a three-dimensional accountability system with “thorns and teeth”.
Statement: Securities Times strives to provide true and accurate information. The content mentioned in the article is for reference only and does not constitute substantive investment advice. Any operations based on this are at your own risk.
Download the official APP of “Securities Times” or follow the official WeChat official account to keep abreast of stock market trends, gain insight into policy information, and seize wealth opportunities.
2024-03-05 22:51:00
#Luo #Wei #member #National #Committee #Chinese #Peoples #Political #Consultative #Conference #member #Central #Legislative #Affairs #Commission #Democratic #National #Construction #Association #firstlevel #inspector #Office #Punishment #Committee #China #Securities #Regulatory #Commission #Increase #supply #systems #build #threedimensional #accountability #system #thorns #teeth
