Recently, the media have successively disclosed the details of the six-year benefit transfer between Li Cheng, the marketing director of the quantitative private equity giant Huanfang Quantitative, and employees of China Merchants Securities. This incident also revealed the truth behind the rumor that "Huanfang Quantitative employees were arrested for brokerage rebates" in November last year. To trace the source of this benefit transfer case, we need to start with the resume and business dealings of the relevant personnel.
According to reports, Li Cheng once worked for China Merchants Securities, or based on business and personal relationships, Huanfang Quantitative concentrated some high-frequency large-amount transactions in the China Merchants Securities business department to complete.
However, it is expressly prohibited by regulations for brokers to directly rebate commissions to customers.
In order to avoid supervision, Li Cheng and Meng Pengfei, the former general manager of the Shennan East Road Sales Department of China Merchants Securities, designed a "curve commission" plan.
The specific operation is that Meng Pengfei's relatives serve as Huanfang's exclusive brokers, import Huanfang's quantified transactions into the designated business department, and then collect performance bonuses through the relatives' bank cards.
The investigation shows thatIn the six years from 2018 to 2023, the two used this illegal method to obtain a total of 118 million yuan in rebates, of which more than 20 million yuan flowed into Li Cheng's account, 10 million yuan was used to "manage" Liu Huan, general manager of the Private Client Department of China Merchants Securities Headquarters, and the remaining more than 80 million yuan was retained by Meng Pengfei.
In November 2024, Li Cheng was taken away for investigation. According to a report by the "China Times" on November 22, 2024, the newspaper asked Huanfang to quantitatively verify the matter.
Relevant personnel from the marketing department of Huanfang Quantitative Company responded: "We have indeed received news that Li Cheng is assisting in the investigation. The specific content of the investigation is not yet known. The company level has not been notified, and the company cannot contact him personally. This matter is a personal behavior of an employee and has no impact on the company. All businesses are operating normally."
It is worth mentioning that in this case, before the incident, Meng Pengfei handed over 3 million yuan worth of gold to Gao Xiang, then head of China Merchants Securities Shenzhen Branch, in an attempt to seek "guarantee."
Although Gao Xiang returned the gold, he was still put on file for review on May 30 this year on suspicion of malfeasance.
Public information shows that Huanfang Quantitative is a well-known quantitative hedge fund company in my country and plays a decisive role in the field of quantitative investment. It is known as the "Four Quantitative Kings" together with Jiukun Investment, Mingtun Investment, and Lingjun Investment.
The company was established in 2015 and mainly focuses on quantitative investment strategies, especially index enhancement strategies.
Its founding team has been conducting research in the field of quantitative hedging since 2008. In October 2015, the first Sunshine Private Equity Fund product was established. On October 21, 2016, the first trading position generated by deep learning was launched. In 2017, deep learning technology was fully applied for trading.
Not only that, in April 2023, Magic Square Quantitative also publicly established a new independent research organization-"DeepSeek" in order to explore the nature of AGI (General Artificial Intelligence).
