On November 19, BROAD Holdings announced that Grand Petrochemical, a 70% subsidiary of BROAD Property Holdings, a wholly-owned subsidiary, was seriously insolvent and was unable to pay off its due debts. It plans to apply to the People's Court for bankruptcy liquidation as a debtor.
In August 2016, Yuanda Petrochemical Yuanda Properties, a subsidiary of Yuanda Holdings, was reported to be maliciously manipulated by futures under real names.
After review, from May 24 to August 31, 2016, the then chairman Wu Xiangdong (legal representative) of Yuanda Petrochemical Co., Ltd. decided to convene a meeting. Using 18 accounts actually controlled by the company, through a large number of continuous purchases at market prices And open positions to transform capital advantage into position advantage.
At the same time, through direct purchase, agency purchase and holding, after-sale repurchase and other methods to hoard a large amount of polypropylene spot, creating the illusion of tight spot supply and demand, adversely affecting the futures market and manipulating the price of PP1609 across the futures and spot markets.
BROAD Petrochemical manipulated the PP1609 contract price for more than 3 months, totaling 70 trading days. During this period, the PP1609 contract price started at 6,280 yuan/ton, and reached a maximum of 8,516 yuan/ton, with a cumulative increase of more than 30%. Among them, the daily limit was recorded on June 27 and July 4.
On September 30, 2020, the Intermediate People’s Court of Fushun City, Liaoning Province publicly announced the first-instance verdict on the case of the defendant Yuanda Petrochemical Co., Ltd. and the defendant Wu Xiangdong for manipulating the futures market, and imposed a fine of 300 million yuan on the crime of manipulating the futures market. Wu Xiangdong was sentenced to five years in prison and a fine of 5 million yuan; 436 million yuan of illegal income from Broad Petrochemical was recovered according to law, and more than 4.87 million yuan of illegal income from Wu Xiangdong was recovered according to law; the illegal income in the other 11 accounts involved in the case continued to be recovered.
BROAD Holdings is an enterprise mainly engaged in commodity trading, with its core business entity as its wholly-owned subsidiary, BROAD Products. The main business entity of Broad Products' petrochemical products is Broad Petrochemical, which was established in June 2011 with a registered capital of 100 million yuan. Yuanda Products holds 70% of its shares. The company's business scope includes wholesale and retail of chemical products, natural rubber, natural latex, textile materials and products, plastic materials and products, fuel oil, and asphalt. It is understood that the company's actual main products are polyethylene (PE), polypropylene (PP), polystyrene (PS), ABS, etc.
