A Case Study of Financial Fraud at ST Huātōng Based on the GONE Theory

Abstract

In recent years, financial fraud in China’s securities market has become pervasive, seriously harming investors’ interests and undermining market stability. This paper reviews the entire process of financial fraud committed by ST Huātōng, revealing the fraudulent behaviors and the resulting specific economic losses and quantitative impacts. By applying the GONE theory, the study explores the root causes of the fraud and its multi-dimensional impacts on various stakeholders from four dimensions: Greed, Opportunity, Need, and Exposure. Finally, three countermeasures are proposed to address financial fraud among listed companies: strengthening corporate governance and personnel compliance awareness; enhancing regulatory intensity and the application of technology; and reinforcing the responsibilities of intermediaries while guiding investors toward rational decision-making.