Securities Fraud Blog | Find out if your broker is liable for your losses

TAG | Chinese Corportations

May/11

28

Multiple Chinese Companies Listed on U.S. Stock Exchanges Shut Down by SEC

Comments off · Posted by admin in FINRA

Throughout 2010, the Security and Exchange Commission (SEC) began an investigation into Chinese companies in the United States that became public through a process called “reverse mergers.”  The term, reverse merger, is also referred to as a reverse takeover or RTO. In an RTO, a Chinese company is acquired by an American “shell” company. An American shell company is a company which already has stock trading in the U.S., but the company does not operate a business or own assets. These Chinese companis merge into the shell. Through this process, the Chinese company can be brought public without the regulatory scrutiny of the Initial Public Offering (IPO) process in the United Sates.

On February 1, 2011, the SEC charged eight individuals and three RTO companies – China Digital, Global Peopleline and m-Wise – in a $33 million fraud. The SEC alleges that defendants engaged in schemes to pump up the price and trading volume  then dumped (sold) millions of shares of these securities into the market making millions of dollars in profits, leaving unsuspecting investors with shares worth next to nothing. Other such examples include China Energy Savings Technology, Fuwei Films, and China Water and Drinks.

The U.S. exchange trade officials have halted the trading of four Chinese companies brought public by WestPark Capital of California. WestPark brought the following four Chinese based companies public: NIVS IntelliMedia (NIV), China Intelligent Lighting and Electronics (CIL), China Century Dragon Media (CDM), and China Electric Motor (CELM). Allegedly to inflate their income statements and assets on their balance sheets.

If you or a family member have lost money in a Chinese company stock listed on a U.S. stock exchange call Soreide Law Group, PLLC, for a free consultation about potentially recovering your investment losses.  To speak with an attorney, call 888-760-6552, or visit www.stockmarketlawsuit.com. Soreide Law Group, PLLC., representing investors nationwide before FINRA  the Financial Industry Regulatory Authority.

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May/11

23

Chinese Stock Losses

Comments off · Posted by admin in FINRA

Did your broker or financial advisor recommend Chinese stock? The past two months have brought a spate of de-listings and trading halts for these Chinese based companies — at least 24 according to the SEC. Forbes’ Walter Pavlo recently detailed a smattering of them:
  • China Electric Motor – Shareholders lawsuit filed claiming underwriters violated federal securities laws by issuing materially false and misleading information.
  • China Natural Gas – Class action lawsuit alleges directors and officers issued materially false and misleading statements. CFO of company resigned in late 2010.
  • Duoyuan Printing - SEC investigating company for fraud, NYSE delisted April 4, 2011
  • China MediaExpress Holdings, Inc. – Deloitte quit as auditor because “no longer able to rely on the representations of management”. CFO resigned. Stock trading halted March 11
  • China Agritech – Shareholder lawsuit pending. Dismissed its auditor Ernst & Young.
  • China Sky One Medical – Under investigation by SEC.
  • Orient Paper, Inc. – Reauditing previous financials due to license issues with previous auditor (Davis Accounting Group)
If your broker of financial advisor recommended the purchase of more than $100,000 of any of these or other “Chinese Corporations” contact Soreide Law Group, PLLC, at 888-760-6552, or visit our website at: www.stockmarketlawsuit.com.

Soreide Law Group, PLLC., representing investors nationwide before FINRA  the Financial Industry Regulatory Authority.

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