Safeguarding the rights and interests of investors and safeguarding their confidence are important prerequisites for promoting the sustained and healthy development of the capital market. To help build a good capital market order, safeguard the legitimate rights and interests of investors, and fulfill the responsibilities and obligations of listed companies, Guanzhong Ecology will launch a "Investor Protection" publicity column this year, with one issue per month, to spread official voices, convey professional knowledge, help investors improve their investment knowledge level, enhance their ability to distinguish the authenticity of information, and stay away from false advertising, illegal stock recommendations, malicious speculation and other behaviors.

"Guanzhong Ecological Investor Protection" Promotion Column

Issue 1: Stay away from "illegal recommendations of stocks, funds, and futures"

The illegal activity of "illegal recommendation of stocks, funds, and futures" is a "cancer" in the capital market, seriously disrupting the order of the securities market and damaging the legitimate rights and interests of investors. In this issue of the "Guanzhong Ecological Investor Protection" publicity column, we will use a combination of theory and case studies to popularize the relevant knowledge of "illegal recommendation of stocks", let everyone know its tricks, and avoid property losses.

1. The manifestations and policy boundaries of "illegal recommendation of stocks, funds, and futures"

1、 Definition

Illegal fund recommendation "refers to the business activity of unqualified institutions and individuals providing investment advice on public funds and other investment products recognized by the China Securities Regulatory Commission to investors or clients, and directly or indirectly obtaining economic benefits. Illegal recommendation of stock futures "refers to the activity of unqualified institutions and individuals providing direct or indirect paid consulting services such as securities and futures investment analysis, forecasting, or advice to investors or clients.

2、 Form of expression

① Recommend stocks, funds, and futures through live streaming and short videos. It mainly refers to the creation or use of Internet platforms to open live broadcast rooms or release short videos, and directly or indirectly recommend stock fund futures in the name of "anchor", "broadcaster", "blogger", "circle owner", etc.

② Recommend stocks, funds, and futures on Weibo and WeChat. Mainly refers to recommending stocks, funds, and futures directly or indirectly under the names of "stock gods," "big Vs," "teachers," etc. through social networking tools such as Weibo and WeChat.

③ Software recommends stocks, funds, and futures. Mainly refers to the sale or provision of recommended stock, fund, and futures software, providing investment analysis opinions, selection recommendations, buying and selling timing suggestions, and predicting price trends for stocks, funds, and futures varieties.

④ Recommend stocks, funds, and futures for training. Mainly refers to recommending stock, fund, and futures directly or indirectly through promoting courses such as "financial management," "investor education," "financial education," "stock trading," and "buying foundations," and organizing investment lectures, reports, analysis meetings, and other methods.

3、 Violation of policy boundaries

According to the relevant provisions of the Fund Law, the act of "illegally recommending funds (public offerings)" is suspected of engaging in fund service business without authorization. According to the relevant provisions of the Securities Law, the act of "illegal recommendation of stocks" is suspected of illegal operation of securities business. According to the relevant provisions of the Futures Trading Management Regulations, the act of "illegal recommendation of futures" is suspected of illegal operation of futures business.

2. Real case: "Guoxuan Tang" was sentenced to the crime of illegal operation for illegal stock recommendation

Previously, CCTV Finance Channel exposed a large-scale illegal stock recommendation black platform case, in which criminals charged over 38 million yuan in membership fees to more than 3000 investors and illegally provided "stock recommendation" services over a period of more than a year. The main perpetrator of the criminal gang was sentenced to 6 years in prison and fined 3 million yuan, and was severely punished by law.

Black platform opens' investment course ', salesperson transforms into' black mentor '

Since October 2016, Dai and others have registered and established Shanghai Yuanhui Enterprise Management Consulting Co., Ltd. (hereinafter referred to as the "Company"). Without obtaining approval from the China Securities Regulatory Commission, the company established the "Stock Xuan Tang" website and published a large number of "advanced courses," "mentor analysis," "performance review," and other content containing guidance for stock trading, attracting investors' attention. The company packages its employees as "mentors" and "stock gods" with high success rates and stable profits by fabricating their work experience as "large securities firms" and "private equity institutions", and fabricating "historical records". In fact, company employees do not have securities industry qualifications or professional abilities in securities investment analysis.

Frequent occurrence of "profit chart" in WeChat groups. Investors recharge and join as members

Under the promotion of the "Stock Xuan Tang" website, investors either actively or are recruited to join the company's established WeChat groups. The names of WeChat groups are mostly powerful and passionate, such as the "June Special Battle Doubling Group" and "One Wave of Tactics Secret Training Camp". The company arranged salespersons to play different roles such as "mentors" and "students", continuously posting false screenshots in the group such as "Teacher XXX's short-term stock selection skyrockets by 30%" and "Student XXX's monthly income doubles", and then began selling monthly, quarterly, semi annual or annual membership courses ranging from 998 yuan to 69800 yuan. Under the bombardment of "profit" messages in WeChat groups, investors are gradually losing their rationality and buying membership services one after another.

Recommended stocks suffer consecutive large losses, membership fees are refunded, and rights protection is blacklisted

After investors purchased members, they gradually found that the stocks recommended by "mentors" and "stock gods" were not working, and there was no "continuous surge" or "rocket launch" situation. Instead, they lost money, fell continuously, and were deeply trapped as soon as they bought. At this moment, investors woke up from a dream and realized that they had been deceived, demanding that the company refund the membership fee. At first, salespersons would appease investors, using the excuse of poor teacher condition as a perfunctory gesture, and even deceive investors into continuing to purchase more advanced courses, promising to introduce more powerful teachers. But once it is discovered that the investor's attitude towards requesting a refund is firm, the salesperson will immediately block the investor's contact information such as WeChat and ignore any demands.

The people's court severely punishes the illegal recommendation of stocks by the black platform "Guxuan Tang" and is sentenced to the crime of illegal operation

After receiving reports from the public, the Shanghai Securities Regulatory Bureau of the China Securities Regulatory Commission immediately initiated investigations and transferred relevant clues to the public security organs for filing and investigation. At present, the People's Court of Songjiang District, Shanghai has ruled that Dai and five others have committed the crime of illegal business operations, and have been sentenced to imprisonment for 6 years or less, confiscation of illegal gains, and a fine of 3 million yuan or less.

III. Tips at the end of the article

We solemnly remind investors to keep their eyes open and carefully distinguish, and not to be deceived by the so-called past performance of black mentors and fake stock gods. If you need securities investment consulting services, please select a securities company or securities investment consulting institution that holds a securities investment consulting license (the list can be found under the "Regulatory Objects" section of the China Securities Regulatory Commission website). If you are infringed by illegal stock recommendation activities, please report to the local securities regulatory bureau or report to the public security organs.