On September 11, 2025, Hylink Digital Solutions Co.,Ltd. (ST Hylink, Code: 603825) announced that the company and related personnel received administrative penalty decisions from the Beijing Securities Regulatory Bureau of the China Securities Regulatory Commission (CSRC).
Following investigation by the CSRC Beijing Bureau, ST Hylink was found to have committed the following violations:
**First Violation: Failure to Disclose Non-Operating Fund Occupation**
ST Hylink failed to properly disclose non-operating fund occupation by its controlling shareholder and actual controller, resulting in significant omissions in relevant periodic reports. In 2021, ST Hylink and its wholly-owned subsidiary Beijing Hylink Creative Advertising Co., Ltd. provided a total of 181.53 million yuan to controlling shareholder and actual controller Su Tong through Beijing Jiashi Zhaofeng Investment Management Co., Ltd., constituting non-operating fund occupation by the controlling shareholder and actual controller.
ST Hylink failed to disclose this 181.53 million yuan non-operating fund occupation in its 2021 interim report and 2021 annual report, representing 10.02% and 7.84% of disclosed net assets respectively. The company also failed to disclose the outstanding balance of 181.53 million yuan in its 2021 interim report, 2021 annual report, 2022 interim report, 2022 annual report, and 2023 interim report, accounting for 10.02%, 7.84%, 7.91%, 11.73%, and 12.07% of disclosed net assets respectively. As of December 31, 2023, ST Hylink had recovered the occupied funds.
**Second Violation: Insufficient Bad Debt Provisions**
ST Hylink under-provisioned for bad debt reserves on accounts receivable from Beijing Xinuo Kejie Trading Co., Ltd., resulting in false records in relevant periodic reports. This led to inflated total profits of 17.33 million yuan and 69.39 million yuan in the 2021 and 2022 annual reports respectively, representing 6.72% and 10.31% of disclosed total profits. On July 10, 2025, ST Hylink issued an announcement correcting prior accounting errors and making retrospective adjustments to related financial information.
The CSRC Beijing Bureau determined that ST Hylink's failure to disclose non-operating fund occupation resulted in significant omissions in multiple periodic reports from 2021 to 2023, and the insufficient bad debt provisions led to false records in the 2021 and 2022 annual reports. Consequently, the CSRC Beijing Bureau ordered ST Hylink, Su Tong, and Guo Jianjun to make corrections, issued warnings, and imposed fines.
**Previous Developments**
On January 15, 2025, ST Hylink announced that the company and former actual controller Su Tong received investigation notices from the CSRC for suspected violations of information disclosure regulations. On July 11, 2025, the company announced corrections to prior accounting errors. On August 23, 2025, ST Hylink announced receiving prior notification of administrative penalties from the CSRC Beijing Bureau.
**Legal Basis for Compensation**
According to the Civil Code, Securities Law, and Supreme People's Court judicial interpretations regarding civil compensation for false statements, listed companies, controlling shareholders, actual controllers, directors, supervisors, senior management, and intermediary institutions must bear civil compensation liability for securities fraud that damages investor rights. Compensation scope includes investment losses, commissions, stamp taxes, and interest losses. Damaged securities investors may file civil compensation lawsuits with competent courts.
**Lawyer's Compensation Criteria**
Given ST Hylink's penalties for information disclosure violations, Shanghai Hanlian Law Firm partner Song Yixin is collecting cases to represent investors in compensation lawsuits. Attorney Song believes that investors who purchased ST Hylink securities between August 18, 2021, and July 10, 2025, and sold or continued holding after July 11, 2025, may be eligible for compensation claims.
**Legal Disclaimers and Requirements**
1. The suggested compensation criteria are for reference only and do not constitute investment advice. Final compensation conditions will be adjusted based on CSRC administrative penalty conclusions and determined by court judgments regarding legal timeframes, compensation targets, scope, standards, and calculation methods.
2. While investors can file direct lawsuits after administrative penalty prerequisites were removed, professional legal advice suggests that administrative penalty decisions should still be considered necessary prerequisites for litigation due to limited investigation means and litigation risks.
3. Whether the listed company is delisted does not affect civil tort litigation proceedings but may impact litigation progress. Bankruptcy procedures (including reorganization, pre-reorganization, or liquidation) may significantly affect litigation progress. Investors may choose to participate in or withdraw from representative actions.
4. Investors seeking compensation should provide: (1) ID card copy, (2) original securities account opening confirmation (stamped by securities company), and (3) original securities transaction records from first purchase to present (stamped by securities company).