Wednesday, May 25, 2011

More About Longtop Financial

I mentioned the US-listed Chinese company Longtop Financial earlier this week. According to Henry Blodget,

"it turns out that Longtop had institutional help in perpetrating its fraud. The reason Longtop was able to fend off skeptics for so long, despite multiple analysts arguing that it was a fraud, was that Chinese banks were complicit in the scam."


Taylor Conant said...

I forget where I just read this today (maybe the recent Kerrisdale Capital letter?) but someone was saying there is a lot of fraud in the Chinese reverse mergers and such but it's hard to pin any blame for wrongdoing on the US auditing firms and investment banks who are doing the backend filing for these things because there are no extradition treaties between the US and China and the fraud is being perpetrated by Chinese management teams.

Uh, please.

So these firms aren't responsible for thinking about who is hiring them, and why? And the NYSE/NASDAQ aren't responsible for making sure that the companies listed on their exchange aren't listed solely to carry out a fraud against unwitting US investors? And what about investors themselves, who aren't looking closely before they buy.

These things don't happen by accident and they certainly don't happen all by the efforts of Chinese fraudster management teams by themselves.

EconomicDisconnect said...

Shocking that the China government was involved in propping up stocks and stuff, I thought that was out deal! They do copy everything!

CP said...

Global depression in 3.. 2.. 1..