(Yicai Global) Nov. 22 -- Shares of UniStrong Science & Technology slumped after the Chinese navigation equipment maker was fined CNY6 million (USD838,038) for inflated earnings between 2017 and 2020.

UniStrong's stock price [SHE: 002383] closed 8.4 percent down at CNY7.09 (USD1), after tanking as much as 9.7 percent intraday.

The chip and receiver maker faked around CNY520 million (USD72.6 million) in profits and about CNY1.6 billion (USD223.5 million) in revenues during the four years, based on a notice the Beijing-based firm received from the China Securities Regulatory Commission yesterday. The firm can appeal the decision.

Moreover, the former chairman and general manager of UniStrong will be banned from the Chinese securities market for a decade, the notice added.

The scandal began unfolding in May 2021 as Yicai Global reported how nearly 20 listed firms were involved in the "biggest scam in the history of the A-share market," possibly amounting to almost CNY100 billion (USD14 billion).

The firm disclosed earlier that it had entered the private network business, joining others, including Raisecom Technology, Guorui Technology, and Zhongli Group, that were later probed for similar claims.

UniStrong added over 20 percent increases to its annual revenues and boosted its net profit numbers by CNY1.3 billion, or almost 200 percent of the actual sum, during the four years, based on the notice.

The segments that were most affected were those for radars and private wireless networks in 2017 and 2018. Nearly 60 percent of the private network business revenue was false and over 80 percent of the related profit was fake. The firm began to engage in such business in March 2017.

Moreover, the company fabricated its software sales, technical service fees, and loan discounts. This should make investors look at UniStrong's earnings report for 2017 in a new light as the report claimed that revenue had doubled and net profit had jumped by almost 150 percent.

Editors: Shi Yi, Emmi Laine, Xiao Yi