The Study On IPO Fraud In The Gem Board

China's GEM opened in 2009,after seven years of development,the market size is growing,more and more enterprises listed on the GEM.However,the GEM listed companies are mostly private enterprises,family business enterprises,their own excessive concentration of ownership,internal control is not the effective implementation of the problem.Second,the establishment of the GEM is still short,for the GEM securities issuance supervision laws and regulations are not perfect,which gives the enterprise financial fraud,the GEM has become the hardest hit for the IPO fraud.GEM IPO fraud not only undermines the interests of investors,but also reduces the community on the GEM listed companies confidence,the long run will seriously hinder the development of the GEM market,it is necessary for the GEM IPO fraud in-depth study and put forward Precautionary advice.Xintai Electric is the first GEM to be delisted due to IPO fraud,it is in order to solve the problem of accounts receivable balance is too large to meet the conditions of issuance of GEM securities,to take a fictitious accounts receivable recovery,adjust the business Cash flow,inflated profits and other means of fraud.Xintai Electric on January 27,2014 the initial public offering and landing the GEM,in July 2015 by the Commission on investigation,in July 2016 received the Commission issued the "market for the decision" and "administrative Punishment decision book ",in September 2016 the Shenzhen Stock Exchange to suspend the listing of its decision,and its start compulsory delisting procedures.Xintai Electric's forced delisting shows the SFC's determination to strengthen supervision of fraudulent conduct,helping to improve the delisting mechanism and investor protection mechanisms.In this paper,taking Xin Tai electrical event as an example,this paper analyzes the internal control factors such as internal control environment,control activities and internal supervision,and evaluates the effectiveness of its internal control.It clarifies the responsibilities of intermediary organizations,The author analyzes the problems of securities supervision and regulation in Xintai electrical fraud,ignores the two issues of media supervision,analyzes the administrative punishment,criminal punishment and civil compensation of IPO fraud To measure the penalty is not enough deterrence,false cost of the conclusion is too low.Corresponding to the above analysis,this paper carried out on the internal control of enterprises to prevent intermediary agencies to deregulation,strengthen securities regulation,improve the cost of IPO fraud thinking,with a view to the enterprises themselves,intermediaries,regulators to take preventive measures to provide false Must refer to the value of information and advice.