Case Concerning Fraudulent Issuance of Bonds of X Leather Co., Ltd., Zhou XX, and Others, and Issuing Certification Documents with Material Misrepresentations of Ma X
(SPP Guiding Case No. 219)
Key words
Fraudulent issuance of bonds; Private placement bonds for small and medium-sized enterprises (SMEs); Personnel of intermediary organizations; Issuing certification documents with material misrepresentations; Industry governance
Summary
In handling cases involving the fraudulent issuance of bonds, the people's procuratorates shall, in accordance with China's current laws and regulations on financial administration, accurately determine the scope of "company and enterprise bonds" as stipulated in the Criminal Law. Newly developed financial products may be characterized as "company and enterprise bonds" for the purpose of identifying fraudulent issuance, provided that they meet the requirements set forth in the Company Law of the People's Republic of China and the Regulations on the Administration of Enterprise Bonds. With respect to personnel of intermediary organizations involved in such cases, the principle of consistency between subjective intent and objective conduct shall be applied to determine, in accordance with the law, whether they constitute joint offenders of the crime of fraudulent issuance of securities, or have committed the crime of providing false certification documents, or the crime of issuing certification documents with material misrepresentations. The people's procuratorates shall extend their focus from case-by-case punishment of securities-related crimes to the broader prevention of financial risks, and enhance capital markets governance on an industry-wide basis through the performance of their procuratorial duties.
Relevant provisions
Articles 160 and 229 (1) and (3) of the Criminal Law of the People's Republic of China (Rev.1997) (now Articles 160 and 229 (1) and (3) of the Criminal Law of the People's Republic of China)
Article 154 of the Company Law of the People's Republic of China (Rev.2005) (now Article 194 of the Company Law of the People's Republic of China)
Article 2 of the Securities Law of the People's Republic of China (Rev.2005) (now Article 2 of the Securities Law of the People's Republic of China)
Article 5 of the Regulations on the Administration of Enterprise Bonds
Article 5 (1) of the Provisions (II) of the Supreme People's Procuratorate and the Ministry of Public Security on the Standards for Filing Criminal Cases under the Jurisdiction of the Public Security Organs for Investigation and Prosecution (No. 23 (2010) of the Ministry of Public Security) (now Article 5 (1) of the Provisions (II) of the Supreme People's Procuratorate and the Ministry of Public Security on the Standards for Filing Criminal Cases under the Jurisdiction of the Public Security Organs for Investigation and Prosecution) (No. 12 (2022) of the Ministry of Public Security)
Article 3 of the Provisions on the Procuratorial Recommendations Work of People's Procuratorates
