FINANCE

China Hits Domestic Auditor With Record Penalty Over Fraud Case

Published: Apr. 13, 2026 4:31 p.m. GMT+8

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Zhongxingcai Guanghua Certified Public Accountants LLP. Photo: Company website

China’s securities regulator has imposed a record 243 million yuan ($35.6 million) penalty on Zhongxingcai Guanghua Certified Public Accountants LLP over audit failures tied to a major corporate fraud case.

The China Securities Regulatory Commission (CSRC) said its Hebei bureau confiscated 32.6 million yuan in revenue and imposed a 210 million yuan fine, while six certified public accountants were also fined, with two barred from the securities market for up to 10 years.

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CSRC fined Zhongxingcai Guanghua 243 million yuan ($35.6M), including 32.6M revenue confiscation and 210M fine, for audit failures in Tunghsu Group fraud; six accountants fined, two barred up to 10 years.
Largest penalty on domestic firm, second to PwC China's 441M yuan for Evergrande.
Firm overlooked red flags, issued unqualified opinions; Ministry of Finance suspended operations 1 year.

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Who’s Who

Zhongxingcai Guanghua Certified Public Accountants LLP: Zhongxingcai Guanghua Certified Public Accountants LLP faced a record 243 million yuan ($35.6M) CSRC penalty for audit failures in Tunghsu Group's fraud, which inflated revenue/profits. Firm ignored red flags, issued unqualified opinions. Six CPAs fined; two barred up to 10 years. Operations suspended 1 year by Ministry of Finance. (52 words)

PwC China: PwC China received a record 441 million yuan penalty in 2024 from China's securities regulator over audit failures in the China Evergrande Group fraud case, the largest ever imposed on any accounting firm.

China Evergrande Group: PwC China was fined a record 441 million yuan in 2024—the largest ever—for audit failures in the China Evergrande Group fraud case, surpassing the current 243 million yuan penalty on another firm.

Tunghsu Group Co. Ltd.: Tunghsu Group Co. Ltd. committed multiyear fraud, inflating revenue and profits by tens of billions of yuan and falsifying cash balances, per CSRC. This led to record penalties on its auditor, Zhongxingcai Guanghua CPAs.

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