Business     

U.S. listed Chinese companies under probe for fraud

Xinhua, September 30, 2011

• Youku.com Inc's website, displayed on a computer screen. Stocks of the company plummeted more than 20 percent after a securities regulator said that U.S. Department of Justice is engaged in probing financial fraud and misconduct of U.S. listed Chinese companies. [Photo/China Daily]

  
  

  A securities regulator said Thursday that U.S. Department of Justice (DOJ) is engaged in probing financial fraud and misconduct of U.S. listed Chinese companies.

  Robert Khuzami, director of enforcement at the U.S. Securities and Exchange Commission (SEC), said DOJ is "actively engaged" in the investigation of the accounting issues of some U.S. listed Chinese companies, and the probe by the SEC and the Federal Bureau of Investigation (FBI) started one year ago.

  Khuzami noted that DOJ's involvement will be "greater" as time goes on. However, he declined to reveal any specific Chinese companies or auditors that the DOJ may be targeting.

  No charges have been brought forward and the SEC and FBI are struggling in acquiring necessary paperwork from the companies, said the official.

  Stocks of Chinese companies listed in the U.S. were dealt a heavy blow by the news. Internet-related stocks were among the most hit. Stocks of Baidu.com Inc., Sina.com Inc. and Sohu.com Inc. all tumbled more than 10 percent in Thursday's trading session. Yoku, the online video website, plummeted more than 20 percent.

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