A "Secret Image" of the Hearing Investigation
Here I would like to insert an excerpt from a report written late at night on June 4, 2001, regarding the hearing of me by two personnel from the Third Division of the Inspection Bureau of the China Securities Regulatory Commission on that day. The content mainly involves In 2001, I wrote "The Inside Story of Funds", and the target of the report was the leaders of the China Securities Regulatory Commission.
This report record, which is quite in the style of Kafka novel, is very thought-provoking. Since I have been working in the media for many years, I have been asked by some relevant parties to cooperate with investigations. There was never a time when I did not take the initiative to cooperate with their work, and the relevant parties were quite satisfied in the end. However, I never thought that the roles of the China Securities Regulatory Commission personnel would be so misplaced. During investigations, I often felt that I was a supervisor and the other party was the subject of supervision.
There is a saying in China that "the emperor is not in a hurry, but the eunuch is." Maybe. I worked in Shanghai Stock Exchange in my early years, and later I was seconded to the China Securities Regulatory Commission for a period of time. I have always been more concerned about studying regulatory principles. The CSRC personnel who came to investigate may not be mentally prepared, so a unique investigation began:
On June 4, 2001, in the conference room on the second floor of the Shanghai Securities Regulatory Office, I was investigated by two comrades from the Third Division of the Inspection Bureau, one was Mr. L, the deputy director, and the other was Ms. W, who was in charge of recording.
When everyone first came into contact, they were all very polite. I introduced the writing background, content and purpose of "Inside the Fund". I think this article is mainly objective research. The description and analysis of fund behavior can be divided into at least three parts:
First, whether funds or institutional investments can stabilize the market, judging from the Shanghai Stock Exchange report, the behavior of mainland funds It is difficult to confirm the conclusion that institutional investors stabilize the market. This is an academic discussion;
Secondly, the fund uses the time difference between the announcement date and the deadline to make a fuss. This is a self-interest motive. Whether it is ethical is secondary, but we suggest that This time difference is shortened so that investors can obtain accurate information;
Third, the Shanghai Stock Exchange report shows the fund’s “ against ” behavior. Since this can promote false trading volume and mislead investors, it is a manipulation. Therefore, " Securities Law " is expressly prohibited.
In addition, the value of the Shanghai Stock Exchange report lies in the basic data. The statistical method used is very simple, and there is no problem of incorrect statistical methods. Therefore, we believe that the above inference analysis can be completely derived from the basic data.
What made me quickly feel that something was wrong was that after Mr. L did not ask two questions, he suddenly signaled the recorder to stop writing. He said, "Let's talk about some issues separately", which means that the following questions will not be recorded.
L talked about his views on "Inside the Fund". My recollection is roughly as follows: first, China's securities market is still very young, and violations of laws and regulations are inevitable; second, the same is true for the U.S. market, where there are more problems; third, "national conditions" must be respected. This kind of thing is not only in There are many of them in the stock market, and there are many in other markets in China; fourth, the Inspection Bureau has few people and is powerless.
What surprised me was that this tone of defense for the fund actually came from a comrade from the Inspection Bureau who should be objective and impartial. I can only answer one by one: First, the Chinese stock market is very young, but being young does not mean that we can break the law. At least we can work hard; second, there were indeed many illegal things in the American market in the early 20th century, but they are not so prevalent now. Third, we need to consider the national conditions, but there are also some general rules in the financial market. For example, the China Securities Regulatory Commission and the U.S. SEC are very similar at least in their initial structures; fourth, your Audit Bureau has a small manpower and needs the assistance and supervision of the media.
I felt very embarrassed as I spoke, because I felt that I was misaligned with L's role. Frankly speaking, I felt that I was popularizing knowledge about why China's stock market needs regulations today. This should have been a basic requirement for their work.
L suddenly said politely, "We don't know each other without fighting. Maybe we will become friends or strangers in the future, it doesn't matter."
I was stunned again, and quickly said, I have no intention of "fighting" with you, I am cooperating with your investigation. In the next two hours or so, Comrade L did not ask me to provide further explanations on the fund behavior mentioned in the article "Insider Stories of Funds". Instead, he focused on one question: Why did "Insider Stories of Funds" achieve this? Being objective and fair, why do you conclude in the "Editor's Note" that the fund violates laws and regulations, etc.
Comrade L was always dissatisfied with the answers I gave after asking questions, and it turned into a debate, and he "diverged" from time to time, making it difficult for me to tell whether he was asking questions during the hearing or inducing me to answer the answer he wanted. . From memory, I describe the two forms as follows:
L:
When you write this article, why do you think the Shanghai Stock Exchange report is true?
I have already said that its data is impossible to falsify, because I can determine this based on my many years of experience in the Shanghai Stock Exchange and industry.
L:
Why don’t you verify it? Are unverified reports objective?
During the Watergate incident in the United States, the " Washington Post " did not verify it with Nixon because this was a very special situation.
L:
I am not talking to you about the United States, this is China.
We cannot verify this because it may be considered as interfering with the audit work or even stealing market intelligence.
L:
(later it came back) Why didn’t you verify it?
Let me say it again, first, I believe in the past principles and reports of Caijing magazine, and I trust it; second, based on my ten years of experience in the industry.
L:
Why do you say this article is scientific and objective?
It is scientific if it is based on facts. Of course, it needs fact testing.
L:
Have you obtained the consent of the report author? Can the article be published without consent?
(I thought to myself, this is indeed a question that after the fund’s joint statement, we considered that if we want to accept the lawsuit, the other party’s lawyer must ask it, because it is the most controversial point. How come L becomes more and more like the fund’s lawyer? ?) We did not issue the original report, only the analysis of the report. (Note: What I didn’t say is that even if the author is willing to authorize it, wouldn’t it harm him under the circumstances?)
L The second question that bothers me is:
L:
Why is he the "editor" of "Insidious Funds"? Press "Finally determined that the fund violated laws and regulations?
This is a note from the editorial department. I have no right to interfere.
L:
When the Inspection Bureau does not recognize this behavior, can the magazine make a decision (without authorization)?
is OK, of course, it may be better to use "allegedly". Because similar statements have actually been circulating in circles for a long time, after obtaining the report, we believe that the facts here have proved that it violates the Securities Law. Since it is illegal, we can determine it.
L:
Do you think it can be recognized?
pairs.In 1994, the American media accused the market maker of Nasdaq of market manipulation based on a report by two scholars. In 1997, the US SEC also recognized this.
L:
This is China, not the United States.
Comrade Zhou Xiaochuan, chairman of the China Securities Regulatory Commission, also made a speech, welcoming the media to cooperate in supervising the market.
L:
We are now discussing the "Insidious Fund".
I have doubts about your stance on the hearing.
L:
Do you think it is responsible to publish "The Secret Story of Funds"?
is responsible! Since the magazine published the article, of course it must be held responsible. One can challenge this determination, as is the case with fund statements.
L:
Can we draw illegal conclusions based on the reported data?
is OK, I just explained it.
L:
Do you (still) think this can be determined before the Inspection Bureau makes a determination?
Yes, I will say it again, I think that before the publication of "Insidious Funds", illegal activities in the securities market had become more and more serious. It was under this circumstance that the identification of "fund shady" appeared. We believe that illegal activities have endangered the development of the market.
L:
This is your personal opinion. You don’t know how much shock “Inside the Fund” has brought to the market. Is this responsible?
Director L, Director L (I would like to remind him that his duty is to conduct inspections), don’t you think that the introduction of “Fund Shady” will have a regulatory effect on the Chinese stock market?
L:
I admit it.
We do not intend to overstep our authority at all, nor do we mean to disrespect the China Securities Regulatory Commission. The reason why "Inside Funds" caused such a big response is that investors want the China Securities Regulatory Commission to have an explanation. A magazine is just a medium, and it cannot have the authority you have. Don't you think so?
L suddenly became furious and shouted loudly: "What is Director L, Director L, are you asking me or I asking you. Today you are here to be investigated!"
Both sides were silent...
L:
I want to ask you , where does the final determination power of China’s securities market lie?
court. (At this time, L was suddenly a lawyer and sometimes an official of the Inspection Office. I began to doubt his identity, even though he showed his work permit at the beginning.)
L: (suddenly smiling bitterly) If you say that, I have nothing to say. .
At this time, L handed me a copy of the rules on media disclosure of information, which clearly stated that if the report is untrue, it will violate criminal laws and so on. I am a securities media worker, so I am certainly familiar with similar regulations, but this situation obviously makes me know what will be waiting for us if we (we) are not objective and truthful.
L:
Let me ask you again, who is the final judge of violations of laws and regulations in China's securities market?
(I was silent for a long time and felt very uncomfortable. I really didn’t want to say it was the China Securities Regulatory Commission at this time, because I was lost in the confusion of whose interests the China Securities Regulatory Commission actually represented and what it wanted to do) China Securities Regulatory Commission.
Note that the question raised by L at this time tempted me to answer his so-called correct question.
L:
So, does the China Securities Regulatory Commission or Caijing magazine have this right to identify?
The China Securities Regulatory Commission has the final right of identification, and the "Finance" magazine has the preliminary right of identification. The China Securities Regulatory Commission has the right to deny Caijing magazine.
L:
(self-mockery) I am really engaged in word work, and I really know how to play word games.
I don't think this is a play on words. But I don’t want to discuss it, because I don’t know when you will “disconnect” again, or when you will become an auditor. Discussions require each other to ask questions. You might as well ask.
Regarding the issue of word games, I also thought of Comrade L’s passage about the fund net value game found in my article.
L:
Why do you say that the fund is a "fraud"? Is the game illegal?
Show it to me. You made a mistake. It says "deception" on it, which is two different things from fraud.
L:
Who is the law enforcement body in China’s securities market?
China Securities Regulatory Commission and its affiliated agencies.
L is also very concerned about one issue, that is how we obtained this report.
L:
Where did you get this report?
Editorial Department of Finance magazine.
L:
I ask you who are you?
reporter Li Jing.
L:
What is the format of this report? Does it have the author's name on it? Is there an official seal? Is there a unit name?
I don’t know. The report I received was in simple text format.
L:
How did you know the author of the report?
"Finance" magazine told me.
L:
Do you believe it?
believe it.
L:
What about that report? Can you leave it to us?
is gone. After the incident, I thought maybe there would be trouble and there would be no need to save it.
L:
Do you know the background of "Finance" magazine?
I don’t know.
L:
I also know that when you go to " finance " magazine, you won't be able to answer any questions, but I still have to ask them as a matter of procedure. Even though I only wrote part of it, you and Li Jing are both co-signed in the article, so you still have to take responsibility for the article, you know?
knows that I am responsible for "Insidious Fund".
L:
So, there are so many "rumors" in "The Fund", is this objective and fair?
This is a popular reporting method. Of course, it would be more coordinated if I separated my analysis part from her article. Analysis is analysis and reporting is reporting. I'm responsible for "Inside the Fund", but it's better to ask her about this part.
L:
I think these "supposedly" are "fatal".
Sorry, I don't think this is "fatal".
L:
I may use this word "inappropriately", but...
The analysis of the report itself is "helping in times of need", which is the most important thing. Other reports may be considered by the editorial department to be more in line with the vividness of the media and are "icing on the cake". If they are not "icing on the cake", that's fine.
L:
In the analysis section, you mentioned that raising the stock price and bookmakers may make double the profit. What evidence do you have?
is reasoning and the view in the circle. Articles are not necessarily supported by data everywhere, especially in the stock market, where I cannot obtain the banker's records. This needs to be verified by your Audit Bureau.
From 2:30 to 5:00 in the afternoon, what we repeatedly asked and answered was the content of these repeated questions. The final record was reviewed and signed by both parties. I think the recorded part is true, but it is obvious that many "divergent" words at the time were not recorded, and I think this has nothing to do with the recorder. Because many of the “debates” and what Comrade L said really didn’t feel like hearings. The following is our last conversation:
L:
I am also following the procedure, so don’t mind. In this position, I have to be objective. In fact, I have never read the report from the Shanghai Stock Exchange.
(I was shocked and speechless) Have you not read this report? Alas, I suggest you take a look.
L:
You just had to push the issue of the "Editor's Note" to the magazine. I also went back to show it to my boss, so I had to give an explanation. Don't worry, the conclusion will be favorable to you. You only wrote the analysis report part. I made a special trip to Shanghai just for you.
If your hearing of this kind was not long after the "Insidious Fund" article was published, I can understand. However, the China Securities Regulatory Commission has publicly announced that funds have indeed violated laws and regulations, and many funds’ annual reports also admit this. And now you have started to open a case to investigate the objectivity of "Insidious Fund". I can't understand it. I don't know which of you represents the China Securities Regulatory Commission.
As for why I insist on the rights of the media, this is because the power of market interests is too strong. Compared with this, the media is very fragile. If we do not uphold this right, the media’s impartial watchdog role will soon disappear.
The last thing I want to say is that due to Comrade L’s repeated questions, I can only make some edits to our conversation to give people a clue. Moreover, this is not a recording. There may be slight discrepancies in individual sentences, but this does not hinder its accuracy.
Due to years of training as a reporter, and five hours after I came back, I quickly recalled it, and I believe it described the scene more accurately.
The pictures in this article are from the Internet and have been deleted
