Corporate executives manipulating stock prices to make profits and concealing the embezzlement of company assets are serious violations of laws and regulations, which will bring great harm to the company, shareholders and the market. This behavior seriously violates the principles of integrity and law. The following are some common methods and related explanations.： ### Means of manipulating stock prices for profit 1. **Information manipulation** -**Divulge positive information in advance** -Executives use the convenience of their positions to disclose the company's major positive news, such as the successful development of new products and the signing of major contracts, to specific stakeholders in advance, such as relatives, friends or institutional investors with relevant interests. These insiders bought a lot of company stocks before the news was made public. After the positive news was officially announced, the stock price rose, and they took the opportunity to sell the shares to make a profit. -For example, an executive of a company learned that the company was about to obtain a large-scale lucrative project, but a few days before the announcement, he informed his associated investment institutions of the news. The institution quickly bought a large number of stocks. When the project announcement was released, the stock price rose sharply. The institution withdrew after making a profit, while ordinary investors took over at a high price. -**Delayed disclosure of bearish information** -Executives deliberately conceal negative information about the company, such as declining performance and financial fraud. By the time it has to be disclosed, the stock price has often fallen sharply, and executives or their related parties sell a large number of stocks at this time to avoid losses. -For example, the company's actual performance is poor, but its executives have been slow to release real financial data in order to maintain the stock price. When it was finally impossible to conceal it, the stock price plummeted, but the executives reduced their holdings in a large number of shares at the high price of the stock in advance, passing on the losses to ordinary shareholders. 2. **Capital manipulation** -**Knock on the transaction** - By controlling multiple securities accounts, executives buy and sell their own company stocks, creating the illusion of active trading. This kind of knock-on behavior can mislead market investors into thinking that the stock has a lot of money to pay attention to and the stock price is about to rise, so they can follow suit and buy. Executives sell stocks to make a profit after the stock price is pulled higher. -For example, executives use multiple accounts under their control to frequently buy and sell company stocks at different prices at the same time, and the volume of transactions increases significantly, and the stock price fluctuates accordingly. Other investors saw changes in trading volume and stock prices, thinking that there was a new positive or the main capital intervened, and they bought one after another, and executives took the opportunity to ship at a high level. -**Boost and suppress stock prices** -Executives combine external funds to focus on buying company stocks within a certain period of time to promote the rise of stock prices, create the illusion of an upward trend in stock prices, and attract more investors to follow suit and buy. When the stock price reaches a certain height, gradually sell the stock to make a profit. -For example, an executive reached an agreement with a private equity fund, and the private equity fund bought a large number of company stocks. At the same time, the executive used the company's internal publicity channels to release some optimistic market expectations to attract small and medium-sized investors to follow suit. After the stock price rose, executives and private equity funds shipped together to suppress the stock price, and small and medium-sized investors suffered losses. 3. **Market capitalization management manipulation** -**Whitewash financial statements** -Executives instruct financial personnel to inflate financial data such as income and profits to make the company's performance look better than it actually is. In this way, the company's valuation is increased and the stock price is promoted. The means of exaggerating financial data include fictitious transactions, early confirmation of income, and under-accounting of costs and expenses. -For example, the company's actual sales revenue did not meet expectations, but in order to increase the stock price, executives asked financial personnel to falsify sales contracts and invoices to inflate operating income. This kind of false financial information misled investors, causing the stock price to rise, and executives cashed out at high stock prices. -**Concept hype** -Executives use market hotspots and concepts to fabricate or exaggerate the company's business or technical advantages in certain popular areas to attract investors' attention. For example, it is claimed that the company has major breakthroughs or layout in emerging fields such as new energy and artificial intelligence, which will cause the stock price to rise sharply in the short term, and then take the opportunity to make a profit. -For example, the company itself has not made actual progress in the field of emerging technologies, but its executives claim that it is developing disruptive artificial intelligence technologies and cooperating with well-known institutions. Investors were affected by this news to buy a large number of stocks, the stock price soared, and executives sold their stocks at high stock prices. ### Means to conceal the embezzlement of company assets 1. **Cover-up of related-party transactions** -**Purchase related party assets at high prices** -Executives set up affiliated companies, and then let the company purchase raw materials, equipment and other assets from affiliated companies at prices higher than normal market prices. Through this kind of high-priced transactions, the company's funds are transferred to affiliated companies, which actually fall into the pockets of executives. In order to cover up this behavior, executives may claim that the purchased assets have special advantages or are of high quality, but in fact they are to empty the company's assets. -For example, a company purchases production equipment from an affiliated company controlled by an executive at a price much higher than that of similar products in the market. Some of the funds from the inflated prices of these equipment entered the affiliated enterprises and were eventually dominated by executives, while the company's assets were embezzled and profits were reduced. At the same time, false procurement transaction records were used to conceal the flow of funds. -**Sell company assets to related parties at a low price** -Executives sell the company's high-quality assets to affiliated companies at a price significantly lower than the fair value of the market. Affiliated companies get it at a low price