香港聯合交易所有限公司
(香港交易及結算所有限公司全資附屬公司)
THE STOCK EXCHANGE OF HONG KONG LIMITED
(A wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited)
The Stock Exchange of Hong Kong Limited
CENSURES:
(1) Zhejiang Yongan Rongtong Holdings Co., Ltd. (Delisted, Previous Stock Code: 8211);
IMPOSES A DIRECTOR UNSUITABILITY STATEMENT and CENSURE against:
(2) Mr Zhan Fahui (Mr Zhan), former chairman, executive director and chief executive officer of the Company;
IMPOSES A PREJUDICE TO INVESTORS’ INTERESTS STATEMENT and CENSURE against:
(3) Mr Jin Lei (Mr Jin), chairman and executive director of the Company at the time of the Company’s delisting;
(4) Ms Zhou Youqin (Ms Zhou), former chief executive officer and executive director of the Company;
CENSURES:
(5) Mr Xia Zhenbo (Mr Xia), non-executive director of the Company at the time of the Company’s delisting;
(6) Mr Yuan Lingfeng (Ms Yuan), independent non-executive director of the Company at the time of the Company’s delisting; and
(7) Mr Zhang Jianyong (Mr Zhang), independent non-executive director of the Company at the time of the Company’s delisting
The Company was found to have transferred nearly its entire cash balance (RMB166.7 million) to its controlling shareholder around year‑end 2024, without complying with the applicable GEM Listing Rules. The board only became aware of the transfer several weeks later when it was identified by the company secretary. Subsequent remedial actions were subject to significant delay.
The Exchange also found:
- Mr Zhan, in breach of his fiduciary duties to safeguard the Company’s assets, executed the transfer at the controlling shareholder’s request without seeking approval from or informing the board, ensuring compliance with internal controls and the GEM Listing Rules, or putting in place necessary safeguards.
- Mr Jin and Ms Zhou breached their directors’ duties by failing to properly supervise the Company’s operations and by failing to detect the significant fund transfers in a timely manner.
- Upon discovering Mr Zhan’s transfers, the relevant members of the board (Mr Xia, Mr Yuan, Mr Zhang, Mr Jin and Ms Zhou) breached their directors’ duties by failing to take timely remedial measures. This included delays in announcing the connected transactions, suspending Mr Zhan’s authority, executing written terms with the controlling shareholder, recovering the transferred funds, and conducting an investigation into both the connected transactions and the effectiveness of the existing internal controls.
- The board further failed to ensure that the Company maintained adequate and effective internal controls. A review revealed significant deficiencies, including weaknesses in connected transaction monitoring and record‑keeping.
The Company and the directors subject to this disciplinary action did not contest their respective breaches or liabilities under the GEM Listing Rules and agreed to accept the sanctions and directions imposed.
Key messages:
Directors owe fiduciary duties to act in the best interests of the issuer and its shareholders as a whole, and to safeguard its assets. They must prioritise the issuer’s interests over those of the controlling shareholder or any other third party. A breach of fiduciary duties is serious and may give rise to suitability concerns regarding the relevant directors.
Issuers and their boards must ensure that any transaction involving a controlling shareholder strictly complies with the applicable Listing Rules, particularly those governing connected transactions. To ensure timely identification of connected transactions and compliance with regulatory requirements, issuers must maintain adequate and effective internal controls.
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Notes:
- The Director Unsuitability Statement is a statement that, in the Exchange’s opinion, Mr Zhan is unsuitable to occupy a position as director or within senior management of the Company or any of its subsidiaries.
- The Prejudice to Investors’ Interests Statement is a statement that, in the Exchange’s opinion, the occupying of the position of director or senior management of the Company or any of its subsidiaries by each of Mr Jin and Ms Zhou may cause prejudice to the interests of investors.
Ends