Resolve Dahlman Manipulation

This article is a case analysis of process from listing to delisting about alisted company of Diamand Co. Ltd Xian Which belongs to the jewelryindustry. The article consists of three parts. The first part is descriptions of history of Diamand. Zonglin Xu wasChairman of Diamand, whose primitive accumulation depended on cheatingthe workers who wanted to work in his company and banks. It has been eightyears for the stocks of Diamand staying at Shanghai Stock Exchange. Theinvestors and banks lost much money because of Diamand. The delisting ofDiamand leaded the stock index to declining hardly. The second part is analysis of financial statements and manipulation ofDiamand. The profits and liabilities of Diamand are fault through some datescomparison between financial statements of Diamand and Sino-Miadend Co.Ltd which is also a listed company in the jewelry industry. The means ofmanipulation included false business transaction, expanding stocks whichhave been bought by other investors, gaining loans from some banks,transferring money from Diamand to some of it's affiliated enterprises forsome deceptive devices of buying equipments for Diamand, and sendingtransferred money to some private accounts of Zonglin Xu in some banksabroad. The last part is causation analysis of Diamand crisis and somesuggestions were proposed. The crisis of Diamand occurred because of thelimitation of rules and laws about economy and lack of integrity in society. Inorder to protect the interests of investors and banks and development ofcapital market, we should constitute relevant laws and establish system ofsocial integrity, then the economy of our society could possibly developbenignly.