Chinese streaming video service Le.com, legally known as Leshi Internet Information & Technology, has been fined 240 million yuan (35 million U.S. dollars) after an investigation into suspected IPO fraud, said the company on Monday.

The China Securities Regulatory Commission (CSRC) had completed its investigation of Leshi's IPO in the A-share market, according to Leshi's statement. Based on two terms in the prior Securities Law, the regulator issued a warning and imposed a fine of 600,000 yuan, ordering the company to make corrections. The regulator also imposed a fine of five percent on funds raised in the IPO, equal to 249 million yuan, which is the biggest fine in the A-share market's history.

The last time that China amended its securities law was in March 2020, marking a key milestone as the comprehensive update included a slew of tweaks that quickened the capital market's transition to a registration-based IPO listing system, made information disclosure requirements stricter, and included tougher penalties for market violations.

However, Leshi's fraud happened before the new securities law took effect. In the new law, fine penalty for severe fraud is at least 10 percent of the funds raised in IPO, which would make Leshi's fine more than 500 million yuan.

Founded in 2007, Leshi made its debut on China's NASDAQ-style board, ChiNext, in August 2010. It is the first video website listed there. On July 21 this year, Leshi was delisted from the board.

Jia Yueting, the co-founder and chairman of Leshi's parent LeEco, was in the center of storm in these years. He once made Leshi immensely popular in China by providing a large number of movies and dramas free or cheap to watch on its website. But since then, it began to expand into making phones, TVs and even electric cars that has led to heavy debt.

Jia's personal bankruptcy reorganization process in the U.S. was completed on June 26.