Recent Press on Chinese Reverse Mergers and Regulatory Deficiencies

Below are recent articles and reports concerning fraud in China, particularly surrounding US-listed Chinese companies, as well as recent press releases announcing class-action lawsuits or investigations against certain US-listed Chinese companies for suspected violations of securities laws. Also below is a table showing total declines in share price, from all-time peak to current, for the companies mentioned.

asensio.com’s reports to regulators on its investigation of the causes of apparent cases of securities fraud among US-listed Chinese companies and related regulatory deficiencies were an important part of informing current policy debates surrounding inadequate auditing and disclosure standards among foreign companies listed in the US via reverse mergers.

September 15, 2010	Travelling through China with the Universal Travel Group: fly from Beijing to Yichang – pick up your tickets at Shenzhen airport!	Bronte Capital
September 14, 2010	Chinese Stocks: More Trouble Than They’re Worth?	TheStreet.com
September 14, 2010	The Law Office of Robbins Umeda LLP Announces an Investigation of China-Biotics, Inc.	Business Wire
September 14, 2010	China Biotics is a Fraud – Now sue Citron – We Dare You.	Citron Research
September 9, 2010	Fuqi International Shares Drop On SEC Investigation	Dow Jones
September 2, 2010	Shapiro Haber & Urmy LLP Files Class Action Lawsuit Against China Natural Gas, Inc.	Business Wire
August 26, 2010	Beware This Chinese Export	Barron’s
August 6, 2010	SEC Obtains Fraud Judgment Against Jason M. Genet, Former Stock Promoter of China Energy Savings Technology, Inc.; Judge Orders $2 Million In Disgorgement and Penalties, Five Year Penny Stock Bar	Securities and Exchange Commission
July 18, 2010	Chinese Debate Allegations on Fraudulent Credentials	The Wall Street Journal
July 16, 2010	Orient Paper Announces Independent Third Party Investigation Into Muddy Waters Allegations	PR Newswire
June 12, 2010	The Rosen Law Firm Files Securities Fraud Class Action Against China North East Petroleum Holdings Limited	Business Wire
June 9, 2010	NYSE-Traded Chinese Company CYD Settles Accounting Case With SEC	The Huffington Post
June 7, 2010	SEC Order Instituting Cease-and-Desist Proceeding Against China Yuchai International Limited	U.S. Securities and Exchange Commission
May 22, 2010	Chinese Small-Caps Join Global Stock Swoon	Barron’s
December 30, 2009	China Finds Huge Fraud by Officials	The New York Times

Stock Price Declines for Certain US-Listed Chinese Companies, From
All-Time Peak to Current (9/16/10)

Ticker	Peak	Current	Decline
ADY	44.00	9.44	-79%
AOB	14.48	2.33	-84%
CBEH	12.31	6.28	-49%
CGA	18.70	8.76	-53%
CHBT	19.74	10.16	-49%
CHNG	15.62	5.81	-63%
CSKI	25.45	6.65	-74%
CYD	21.68	18.39	-15%
DEER	18.97	8.43	-56%
DGW	41.43	12.35	-70%
DYP	11.23	2.52	-78%
FEED	21.31	2.41	-89%
FUQI	32.68	7.07	-78%
GFRE	14.94	7.05	-53%
LIWA	12..69	7.95	-37%
NEP	11.59	5.17	-55%
ONP	15.15	4.17	-72%
RINO	35.15	14.13	-60%
SPU	8.10	4.38	-46%
UTA	17.20	4.05	-76%