21 Jun 2013
SEC charges China-based firm with fraud
WASHINGTON - The US Securities and Exchange Commission on Thursday charged a China-based company and the Chief Executive officer (CEO) with fraudulently misleading investors about its financial condition.
The SEC alleged that China MediaExpress, a company providing television advertising services on buses, began falsely reporting significant increases in its business operations, financial condition and profits almost immediately upon becoming a US publicly-traded company in October 2009.
The SEC also said that the company falsely stated in public filings which the company's chairman and CEO Zheng Cheng signed and attested to their accuracy.
"China MediaExpress and Zheng falsely reported whopping increases in its cash balances and deceptively raised money from stock sales. Today's action demonstrates the Commission's commitment to policing financial fraud in the US markets," said Antonia Chion, Associate Director in the SEC's Division of Enforcement.
The SEC has filed fraud cases against more than 65 foreign issuers or executives and deregistered the securities of more than 50 companies, according to the SEC's Cross-Border Working Group that focuses on companies with substantial foreign operations that are publicly traded in the United States.