Manipulating the market with a huge loss of 300 million yuan! The top trader in North China has been fined again! Dalian Electric Porcelain. Right in Dalian Electric Porcelain | Li Weiwei | North China

After being banned from the securities market for life five years ago, Li Weiwei, born in 1985 and known as the "number one trader in North China," disappeared from public view. However, a recent administrative penalty issued by the China Securities Regulatory Commission brought back the past of its involvement in manipulating Fengxing Shares in 2017.

From October 2017 to the end of February 2018, Chen Weixin, the general manager of Fengxing Shares, along with Li Weiwei, Zhu Yidong, and others, controlled the use of 115 securities accounts and used over 2 billion yuan of funds to jointly manipulate the stock price of Fengxing Shares. However, like the previous manipulation of Dalian Electric Porcelain, this manipulation was also a failure - the account group suffered a loss of 304 million.

Li Weiwei's name is not unfamiliar in the A-share market. Before collaborating with Zhu Yidong, the head of the Fuxing faction, to manipulate Dalian Electric Porcelain, Li Weiwei, a native of Xinzhou, Shanxi, already had the reputation of being the "number one operator in North China" in the funding manipulation circle. After cooperating with Zhu Yidong, Li Weiwei was even offered to the altar - the Four Seasons Hotel Shanghai, where he stayed and traded in 8888 Presidential Suite with bodyguards, and had 40 Lenovo X1 players, all of which were shining with the light of the peak foam.

Zhu Yidong was once a rising star in the Shanghai financial industry, adorned with eye-catching labels such as overseas returnees, top students, second-generation wealthy individuals, and trendsetters in the capital market. However, as his ambitions expanded, the Fuxing clique exploded with lightning, and with Li Weiwei's "divine assistance," Zhu Yidong's fundraising fraud case occurred. He fled abroad and was ultimately arrested and imprisoned. He was sentenced to life imprisonment in 2021. This time he was fined, Zhu Yidong received another 700000 yuan in prison.

Li Weiwei absent from the hearing

After receiving the punishment notice, Li Weiwei requested a hearing. The China Securities Regulatory Commission organized a hearing on May 29th, but Li Weiwei did not attend.

Li Weiwei's punishment this time started with the 2017 Fengxing Stock Manipulation Case. The case is relatively clear: Fengxing Group planned to acquire Xiongwei Precision Industry. Due to the stock price being lower than the issue price, Chen Weixin was introduced to Zhang Zhaoyang, who was engaged in capital allocation. The latter later started to protect the company, but the protection failed.

At this moment, the "savior" Li Weiwei appeared and took over the operation. Zhu Yidong "disregarded past grievances" and participated in manipulating Fengxing Shares by providing asset management accounts, borrowing personal accounts, and providing funds.

The manipulation technique is identical to the previous manipulation of Dalian Electric Porcelain. Manipulating gangs use their financial and shareholding advantages to continuously buy and sell Fengxing shares, trading Fengxing shares between accounts they actually control. They manipulate and affect stock trading prices and volumes through frequent or large declarations, cancellations, and other means without the purpose of transactions, resulting in a significant deviation of stock prices from the SME board composite index during the same period.

However, Li Weiwei, who was well-known outside, was unable to turn the tide and suffered huge losses in his manipulation. During this period, the account group bought a total of 2.156 billion yuan and sold a total of 1.88 billion yuan. The account group has accumulated a loss of 304 million yuan.

In the end, Chen Weixin was fined 800000 yuan, Li Weiwei and Zhu Yidong were fined 700000 yuan each, and the others were fined 400000 yuan each.

Three Penalties, Li Weiwei's Glorious Past

In addition, Li Weiwei has been punished three times by the China Securities Regulatory Commission, mainly for his manipulation from 2016 to early 2018. Li Weiwei has obvious trading characteristics, using huge funds, hundreds of accounts, leveraged capital allocation, and skyrocketing stock prices, but often only one stock is traded.

The first penalty was for manipulating Dalian Electric Porcelain from March 2016 to December 2017, resulting in a huge loss of 551 million yuan. Fined 2 million yuan and banned from the securities market for life.

The second penalty was for manipulating Huijintong from March to April 2017, resulting in a profit of 20.7028 million yuan. Being fined one by one, resulting in a fine of over 41.4 million yuan.

The third time, this time, was due to the manipulation of Fengxing Shares from October 2017 to February 2018, resulting in a loss of 304 million yuan. Fined 700000 yuan.

On two occasions, Li Weiwei was invited to "put out the fire", but he was not an honest person at the mercy of others. During the manipulation process, he not only increased the leverage ratio of the allocation without authorization, used other people's margin and allocation funds to trade other stocks, but also changed the account password and became a "mouse warehouse", repeatedly doing so.

For example, during the manipulation of Dalian Electric Porcelain, Fuxing Group and Li Weiwei successively controlled the use of 25 institutional accounts and 436 personal accounts to trade Dalian Electric Porcelain. At that time, Zhu Yidong, the then chairman of Fuxing Group, was introduced by his subordinates to meet Li Weiwei, a "market value management operator" and a "professional" in trading. He provided him with funds to allocate funds from off the exchange and operate accounts to trade Dalian Electric Porcelain.

When we first met, Zhu Yidong trusted Li Weiwei very much. Not only did he manipulate the accounts that the group was responsible for, but he also directly authorized the transfer of funds to Li Weiwei. In the early days, Li Weiwei was operating in his own company office and was not loyal to Fuxing during the process.

In order to strengthen monitoring, Li Weiwei's team was arranged to conduct transactions at the Fujian Hotel in Shanghai, staying in the 8888 Presidential Suite, equipped with 40 Lenovo X1 laptops, 120 sets of wireless network cards, and 40 wireless routers specifically for use. The catering and accommodation expenses of attendants, bodyguards, and traders were charged to Fuxing Group. Under luxury, Li Weiwei still privately increased his capital allocation leverage to trade other stocks, resulting in unstable market protection and a significant drop in stock prices. As a result, Fuxing Group had to use its own managed asset management products to protect the market.

However, even so, Li Weiwei continued to trade other stocks privately through high leverage capital allocation. Later, due to the continuous limit down of related stocks, Li Weiwei's capital allocation account was fully liquidated, and Dalian Electric Porcelain was forcibly liquidated and continuously hit the limit down.

Fuxing was destroyed, and Zhu Yidong was imprisoned

Zhu Yidong's trust in Li Weiwei is difficult to understand. If it weren't for the deep binding of interests, it would be impossible to explain Zhu Yidong's repeated tolerance and concessions towards Li Weiwei.

Just as Dalian Electric Porcelain's manipulation failed, Li Weiwei and Zhu Yidong began manipulating Fengxing Shares again. This time, Zhu Yidong was punished and did not provide a statement or defense, nor did he request a hearing.

In fact, as early as November 2021, Fuxing Group and Zhu Yidong were publicly sentenced for fundraising fraud and market manipulation. The Shanghai Second Intermediate People's Court fined Fuxing Group 2 billion yuan for the crime of fundraising fraud, and fined 100 million yuan for the crime of manipulating the securities market. It has decided to impose a fine of 2.1 billion yuan.

Zhu Yidong was sentenced to life imprisonment, deprived of political rights for life, and fined 10 million yuan for the crime of fundraising fraud; The crime of manipulating the securities market was sentenced to nine years in prison and a fine of 5 million yuan. The decision was made to execute life imprisonment, deprivation of political rights for life, and a fine of 15 million yuan.

After investigation, it was found that Fuxing Group has illegally raised more than 56.5 billion yuan over the years.

According to the Shanghai Second Intermediate People's Court, since September 2014, Zhu Yidong, Zhao Zhuoquan, Zhu Chengwei, Wang Yuan, Yu Liang and others have been using fictitious investment targets, exaggerating the value of investment projects, and publicly promoting them to the public. They have also used high returns and promises to repay principal and interest at maturity as bait to design and sell financial products such as debt and private equity funds, illegally raising funds from the public, and continuously expanding the scale of funds to maintain the funding chain.

And this illegal activity continued until 2018. By June of that year, Fuxing Group had illegally raised more than 56.5 billion yuan, and the unpaid principal at the time of the incident was more than 21.8 billion yuan.