| With the steady development of China’s capital market,the issuance of bonds has become an important way for more and more enterprises to obtain financing.Due to the low threshold of issuance,simple issuance procedures,and high degree of marketization,corporate bonds are particularly favored by enterprises,especially the promulgation of the “Measures for the Administration of Corporate Bond Issuance and Transactions”,which greatly expands the scope of issuers and enriches the distribution methods.The rapid growth of corporate bond issuance.With the increase in the issuer and the scale of issuance,the corporate bond market has experienced fraudulent incidents that have been used to whitewash financial statements and conceal important information to defraud bond issuance,which has greatly damaged the interests of investors.Financial statements are the main way for enterprises to show their operating results to investors.They directly determine whether companies can obtain bond issuance qualifications.Perfect information disclosure is not only the basic requirement for corporate bond issuance and listing,but also an important reference for investors to make investment decisions.Bond fraud is an illegal act that seriously disrupts the order of the capital market.The reason is that,apart from the low morality of the issuer,it is also inseparable from the lack of independence of intermediaries such as underwriters and the failure to perform their duties diligently and conscientiously.In the past,fraudulent acts in China’s capital market mostly occurred in the stock market.Now that this phenomenon has spread to the bond market,it cannot but arouse our high attention.This paper selects the event in China’s capital market that was identified as the first bond fraud issue by the China Securities Regulatory Commission.The “Wuyang Debt Incident” is a case study.It focuses on the role of underwriters in the process of bond issuance and listing,and empirically analyzes the fraud incident.The impact of underwriters’ reputation and the economic consequences of fraud are the focus of this article.This paper first systematically reviews domestic and foreign literature on corporate fraud and underwriters’ reputation.Secondly,this paper selects Wuyang’s case of fraudulent issuance of corporate bonds,briefly reviews the issuance,default and subsequent disposal process of bonds,systematically sorts out the frauds of the issuer and underwriters in this case,and analyzes the underwriting The cause of conspiracy to defraud.Thirdly,this paper draws on the predecessors’ practices and uses the event research method to analyze in detail the impact of Wuyang’s fraudulent issue of corporate bond events on the reputation of the underwriter Debon Securities from two perspectives.The study found that the “Wuyang Debt Incident” has a direct negative impact on the reputational capital of Debon Securities by affecting the future market share of the target underwriters,but the indirect penalty effect of the event on the reputation of the underwriters is insufficient,and the market and investors Without paying too much attention to the reputation of the underwriters,the “Wuyang Debt Incident” did not have a substantial indirect impact on the reputation of Debon Securities.There is no correlation between the reputation of the underwriters and the reputation of their customers in China’s bond market.The effectiveness of the underwriters’ reputation mechanism has not been realized.Finally,based on the main conclusions obtained in the “Wuyang Debt Incident”,this paper puts forward proposals to curb corporate fraud and improve the issuance and underwriting system of corporate bonds in China.Since the "11 ChaoRizhai" material default,the phenomenon of the bond market in China has been broken,and bond default seems to be not uncommon,but behind the default,bond fraud issuance is the first.Studying the fraudulent behavior in the bond market and its impact on the reputation of underwriters is of great significance in regulating the order of the bond market,better playing the role of financial intermediaries,and protecting the legitimate rights and interests of investors. |
