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Stories like these are going to become increasingly common. Chinese companies are completely opaque and the SEC cannot easily audit Chinese companies. It's easy
by jorblumesea 8y ago
Stories like these are going to become increasingly common. Chinese companies are completely opaque and the SEC cannot easily audit Chinese companies. It's easy to rip off Western investors as the power structures lean towards Chinese citizens, always. Their entire business structure is built with the Chinese first and everyone else second.
SEC statement: https://www.sec.gov/news/public-statement/statement-vital-role-audit-quality-and-regulatory-access-audit-and-other https://www.sec.gov/news/public-statement/statement-vital-ro...
- toomuchtodo 8y agoObligatory reference to The China Hustle, a documentary that won awards for putting the spotlight on this fraud being perpetrated at scale. https://www.nytimes.com/2018/03/29/movies/the-china-hustle-review.html https://www.nytimes.com/2018/03/29/movies/the-china-hustle-r...
- zachguo 8y agoIs there any special treatment to allow Chinese companies doing this? If not, I'm afraid this kind of fraud would apply to many business across the globe. Proper conclusion drawn from this incident is that loophole revealed in such case should be fixed to protect investors.
- nowarninglabel 8y agoSometimes they end up investigating and at least getting someone to pay: https://www.reuters.com/article/macquarie-group-settlement-idUSL1N12J13V20151019 https://www.reuters.com/article/macquarie-group-settlement-i... https://www.nytimes.com/2012/02/24/business/sec-charges-reveal-fraud-in-chinese-company.html https://www.nytimes.com/2012/02/24/business/sec-charges-reve...