December 3rd, Beijing time at 11pm,
New York, Blackstone Headquarters Compliance Department.
An anonymous email arrived quietly.
The sender was a newly registered email address, but the content in the attachment made the head of the compliance department feel sleepy instantly.
Attachment 1: Lu Shen is the complete record of illegal capital injection by Lin Wanqing company.
Amount of capital injection: 300 million Hong Kong Dollar.
Funding source: Blackstone Asia M&A Fund.
Investment target: Three construction companies on the verge of bankruptcy under the name Lin Wanqing.
Question: This investment completely does not meet the Blackstone risk control standards. The target company has negative net assets, no stable cash flow, and no core technology.
The normal investment process requires at least six rounds of approvals, but the money was disbursed within a month.
Attachment 2: Evidence of abuse of Blackstone guarantee when Lu Shen Short Selling Henglong.
Financing channels: Securities lending credit from seven institutions including Morgan Stanley, Goldman Sachs, China International Capital Corporation.
Total credit limit: more than 1.5 billion Hong Kong Dollar.
Question: These credit facilities all rely on the guarantee letter issued by Blackstone.
However, upon investigation, it was found that these letters of guarantee had never been subject to compliance approval, and the official seals were suspected to be forged.
Attachment 3: A summary of the recording of Lu Shen's unauthorized promise to exchange benefits in order to close the position.
Involved objects: Mr. Zhang of a private equity fund, Mr. Li of an insurance fund, Family Office Wang Zong, etc.
Commitment content: Blackstone will have priority to cooperate on three key projects of Asia next year.
Question: These promises were never reported to the headquarters and were completely ultra vires.
If cashed out, Blackstone would lose more than 500 million US Dollar in potential profits.
Attachment West: The special relationship between Lu Shen and Lin Wanqing.
Records of Lin Wanqing's frequent visits to Lu Shen's apartment.
Evidence that Lu Shen guaranteed the loan for Lin Wanqing in his personal name.
The financial exchanges between the two went far beyond normal business transactions.
After reading the email, the head of the compliance department broke into cold sweat all over his back.
He immediately dialed Legal Director:
"Something big happened. Over there in China area, the trouble Lu Shen caused is ten times more serious than we imagined."
It's two o'clock in the morning Beijing time on December 4th.
New York, Blackstone Headquarters Meeting Room.
Emergency meeting is held here.
On the big screen, the heads of the Asia Pacific president, Legal Director, head of the compliance department, and chairman of the audit committee lit up in sequence.
Everyone's face was so solemn that it looked like water was dripping from their faces.
The president of the Asia-Pacific region spoke with a hoarse voice:
"You have all read the email. The current situation is worse than I expected."
Legal Director pushed up his glasses:
"Forging a letter of guarantee is a felony punishable by jail time in United States.
If pursued by the other party, Lu Shen personally faces criminal prosecution.
But the question is - these guarantee letters are in the name of Blackstone. When the other party pursues the case, will Blackstone be involved?"
The Head of Compliance Department added:
"There are also those promise of benefits. He has already used the Blackstone project in exchange, and the other party has the recording.
If these recordings are leaked, Blackstone's reputation in Asia will be destroyed."
The Chairman of the Audit Committee asked:
"What about Lin Wanqing? Will her relationship with Lu Shen become a new hot spot?"
Asia Pacific President said:
"Not yet. But once it is investigated, this illegal capital injection of 300 million people RMB will be enough for the media to write about for three months."
Meeting Room was quiet for a few seconds.
Then, a video window lights up.
He is the actual person in charge of the Blackstone China district - the deputy to the president of the Asia-Pacific region, Chen Ming who is resident in Hong Kong.
He is also Lu Shen's first boss.
His face was uglier than anyone else's.
"Everyone," he said, his voice hoarse, "I have an unshirkable responsibility for this matter."
Everyone looked at him.
Chen Ming Take a deep breath:
"Lu Shen was promoted by me. He has been doing very well at Asia in the past few years. I think he is very capable and reliable.
But I overlooked one thing - people with strong abilities are often courageous."
He paused:
"When he injected capital into Lin Wanqing company, I signed it.
At that time, he told me that this was a conventional preferred stock investment and that the target company had stable cash flow. I signed it without verifying it."
"I knew about it when he Short Selling Henglong. But I thought he was just a personal investment. I didn't expect that he used Blackstone's guarantee."
"While he was negotiating with those people, I was on a business trip at Hong Kong and did not stop it in time."
He lowered his head:
"It's my fault that I'm not strict with you."
There was silence in Meeting Room.
The president of the Asia-Pacific region spoke, his voice colder than before:
"Chen Ming, do you know what it means if you admit this?"
Chen Ming raised his head:
"I know."
He paused:
"I am willing to accept any treatment. Demotion, transfer, dismissal, whatever."
The president of Asia Pacific looked at him for a long time.
Then he asked:
"Is there any way you can remedy it now?"
Chen Ming thought for a while:
"The only remedy is to take the initiative to cut it off."
He looked at everyone:
"Call the police. Hand over Lu Shen. Let Police intervene in the investigation.
We actively cooperated and submitted all evidence to Police to show that we are the injured party."
Legal Director nodded:
"This idea is correct. It is better to take the initiative than to be passively beaten."
The Chairman of the Audit Committee asked:
"What about Chen Ming?"
The Asia Pacific CEO was silent for a few seconds.
Then he said:
"Chen Ming is suspended and is subject to internal investigation. Until Lu Shen's case is cleared up, he cannot participate in any decision-making."
Chen Ming nodded:
"I accept."
The Asia Pacific CEO continued:
"In addition, a special working group has been set up, led by Legal Director, to comprehensively sort out every project handled by Lu Shen. If any problems are found, report them immediately."
Legal Director nodded:
"Understood."
The president of Asia Pacific took one last look at everyone:
"In an hour, I want to see the complete report materials."
Video Conference ends.
A storm is brewing quietly.
Legal Director personally writes, and every word has been carefully considered.
Reporter: Lu Shen, male, 37 years old, former vice president of Blackstone China.
Reason for reporting:
1. Forgery of official documents:
Without authorization from the company, Lu Shen forged at least seven guarantee letters from Blackstone to obtain securities lending credit from Morgan Stanley, Goldman Sachs and other institutions, with a total amount exceeding 1.5 billion Hong Kong Dollar.
2. Illegal investment:
Lu Shen took advantage of his position and, in the name of Blackstone Asia M&A Fund, injected 300 million Hong Kong Dollar into three companies on the verge of bankruptcy under the name of Lin Wanqing.
This investment completely does not meet the Blackstone risk control standards and is suspected of being Interest Transfer.
3. Ultra vires commitment:
During the process of personal liquidation, Lu Shen committed to a third party the priority cooperation rights for future projects in the name of Blackstone without authorization, involving a total project value of more than 500 million US Dollar, seriously damaging the interests of the company.
4. Abuse of power:
Lu Shen used Blackstone China's status as vice president to provide multiple guarantees for Lin Wanqing personally, involving huge amounts of money and seriously conflicting with the company's interests.
Company position:
Blackstone Group has no knowledge of the above-mentioned actions of Lu Shen, and all operations are his personal actions.
The company is willing to cooperate with Police's investigation, provide all relevant evidence, and reserves the right to pursue Lu Shen's legal liability.
At the end of the reporting materials, there is the official seal of Blackstone Group Legal Department.
Two hours later, the materials were delivered to New York Police.
Beijing Time: West o'clock in the morning, Interpol's co-investigation report, sent to China.
Soon, a brief statement quietly appeared on the official website of Blackstone.
<Blackstone Group's statement on matters related to China District>
"Recently, Blackstone Group discovered that Mr. Lu Shen, the vice president of China District, had committed serious violations.
After preliminary investigation, Mr. Lu Shen forged guarantee letters, made illegal investments, and made ultra vires commitments without the company's authorization, seriously damaging the company's interests and reputation."
"Blackstone Group has reported this to Police and is fully cooperating with the investigation.
Mr. Lu Shen has been suspended and his personal behavior has nothing to do with Blackstone Group."
"Blackstone Group's long-term commitment to the China market remains unchanged. We will further strengthen internal controls to prevent such incidents from happening again."
Ten minutes after the statement was issued, major Financial Medias around the world reprinted it one after another.
The name Lu Shen changed overnight from "Blackstone's youngest vice president" to "Blackstone's illegal executive who was urgently cut off".
One stone stirred up a thousand waves. No one expected that Lu Shen would end like this.
The speculation in the market that Lu Shen holds a large position in Short Sellers of Henglong has been confirmed.