Shenzhen Securities Regulatory Bureau: Some private equity institutions are suspected of illegal fundraising, buying and selling “shells” and other violations

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 Titanium Media App reported on July 19 that the Shenzhen Securities Regulatory Bureau released the private equity fund situation, and notified a number of typical problems of private equity institutions such as conducting private equity business without registration, buying “shell” and selling “shell”. Specifically, the typical problems are as follows: First, the private placement business is carried out without registration, and some institutions are not registered as private equity fund managers, and raise funds externally in the name of "fund" and "fund management" to conduct private placement business. Some investment companies publicly raise funds in the form of guaranteed principal and income, and are suspected of engaging in illegal fund-raising and other criminal activities. Individual illegal institutions and personnel set up names similar to well-known financial institutions, or falsely use registered companies to carry out publicity, deceive and mislead investors, and use POS machines to swipe cards to collect investment funds, which makes it difficult for investors to protect their rights and track funds. Second, there are repeated prohibitions on buying and selling “shells”. Some registered private equity institutions know that others are not registered as private equity fund managers and may engage in illegal activities such as over-the-counter fundraising and illegal fundraising, but they still sell or lend the company to others in violation of regulations. . Some private equity institutions continue to raise funds by buying "shells" and borrowing "shells" to deceive investors after their manager qualifications have been cancelled. Some illegal intermediaries are engaged in recruiting affiliated personnel, buying and selling shells by private equity institutions, and issuing legal opinions on behalf of law firms, which seriously violate the laws and regulations of private equity funds. The third is that private fund managers manage unrecorded private funds. After some private equity fund managers complete the fundraising, they start investing without going through the filing procedures at the China Foundation Association. Some private equity fund managers use limited partnerships established by others to raise funds to avoid supervision. Some private equity fund managers collect non-qualified investors into limited partnership enterprises, and then invest in private equity funds that have been registered, to avoid the requirements of qualified investors, and to achieve illegal purposes such as circular fundraising, breaking the 200-person limit, and preparing more for less. (Source: Securities Times)

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