- US Commerce Department
- US State Deparment
US State Department: Implement the "Proposal" with the Chinese Government to Resolve the US Listed Chinese Companies Stock "Scandal" - Please Sign the Petition!
Open Letter Proposal” / Solution to the Media / Public / US Government
RE: Major US Listed Chinese Companies Stock “Scandal”
Dear Sir / Madam:
Please support this “Proposal” / Solution by signing the petition. Thank you.
Many Chinese companies listed in the US, after getting American money from the US citizens/investors (shareholders), stopped filing financial reports and stopped communicating with them (shareholders). One of those companies is Duoyuan Global Water Inc. (DGW). DGW started trading on NYSE on June 24, 2009. Through the two public offerings in 2009 and 2010, about it raised more than 192 million dollars from the US citizens/investors. The last financial report filed with the SEC was on March 22, 2011 (Form 6K, for the quarter and year ended 12/31/2010), since then it has not communicated any financial and operating information to the shareholders. They like many other small to mid cap US listed Chinese companies went ‘dark’, ‘silent’, ‘in hiding’.
DGW’s actions is an example of the fraudulent, scamming, abusive, fiduciary breaching, anti-shareholder model / formula used by many other Chinese CEOs. Please refer to Appendix B – Sample List of Problem US Listed Chinese Companies. This sample of fourteen (14) companies is a small sample of the many US listed Chinese companies that have gone “dark”, delisted, and / or revoked from NASDAQ or the NYSE by the SEC. The problem list is long, please visit:
This issue was pursued by the media for a brief period in early 2013, but it’s gotten worse and should be reported and picked up by the media again:
This Chinese stocks “scandal” is potentially much larger and wider in scope than the “Madoff Scandal”.
The sociopathic and corrupt Chinese company CEOs have essentially abandoned all the shareholders in the USA by stopping any communication. Recovering the value of the assets in China has been a huge challenge to the shareholders of those companies in the US. To address this challenge, DGW (Duoyuan Global Water, ticker: DGWIY) and DYP (Duoyuan Printing, ticker: DYNP) shareholders formed a shareholder group, led by David Yee. After analyzing all possible options, the group decided to seek help from the US government and Chinese government.
Currently, the Chinese government is asking the US government to seize the assets of corrupt Chinese officials in the US. The group is asking the US government to negotiate with the Chinese government to buy-out all the US shareholders of the US listed Chinese companies. The group is proposing:
1. For those Chinese companies listed in the US that have been revoked or have not filed financial reports for two or more years (see Appendix B for examples), use the Money seized from the corrupt Chinese officials in the US (who moved to the US with assets stolen from or that belong to China, attempting/hoping to hide/escape) to buy out the US shareholders (all the shareholders excluding the insiders) at not less than 70% of the book value reported in the last financial report.
a. China will warn the managers of those companies in China that they have violated the US securities laws by not filing the financial reports and ask them to comply with the securities laws within three months. If they cannot comply with the securities laws, they should consider buying out the shareholders at fair price that is usually not lower than the net asset price, in order to resolve the issues with the shareholders.
b. For those companies that do not file all the necessary financial reports and do not offer buy-out at a price of not less than 70% of the book value after three months. Chinese government will offer buy-out of the shareholders using the assets seized from the corrupt Chinese officials in the US.
2. Apply article 183 (Chapter X) of China corporate law to those companies without buy-out in the previous step. China assigns a specific court in China to handle all the cases that involve those Chinese companies listed in the US. If the share price have been below 25% of the book value for one or more years, the interests of the shareholders is considered to have heavy loss if the company continues to exist. If shareholders, whose combined ownership in the US parent company can be translated into 10% or more of ownership of the business entity in China, vote to dissolve the corporation (to sell the business), the Chinese court will sell the business in China based on article 183 (Chapter X) of China corporation law.
Our “Proposal” / business transaction complies with US corporate law and Chinese corporate law so it should be straightforward to implement, enforce, and complete. For additional information to show that the “Proposal” is similar or in line with what other countries, such as Australia and Canada are doing, see Appendix A.
The group along with shareholders of other Chinese companies listed in the US is now contacting various media, rights & activists groups/organizations, and government departments, agencies and officials (both elected and non-elected) to discuss the “Proposal” and get their support. The group expects that many other US citizen shareholders and their supporters from all across the USA will join this effort/action and help the government and media understand that this “US Listed Chinese Company stock scandal” has hurt small investors and Middle America far more than the infamous “Madoff scandal”. The group believes that the proposal offers the best practical solution to alleviate the pain caused by the “US Listed Chinese Company stock scandal” to the US citizens.
Our goal is to get the US government to negotiate with the Chinese government to buy-out the shareholders using the money seized in the US. There will be no financial cost to the US government. Instead, it will offer many benefits to the USA and Global financial/capital community and investors. Firstly, getting the Chinese government to buy-out the shareholders in the US will help keep the money in the USA after seizing the assets of corrupt Chinese officials. Secondly, it will motivate Chinese government to pressure the Chinese management of those companies to comply with US securities laws in the future. Thirdly, knowing that there are strong repercussions for fraud and abuse of USA Citizen shareholders/investors, it will restore confidence in Chinese and other overseas companies that are listed in the USA.
The timing is perfect to resolve this with the “Proposal” solution we have brought forth to the US Government, given the Chinese Premier’s mandate is to crack down and punish corruption and graft, for reference:
For those companies where a buy-out is not possible, the group thinks that selling all the China assets is a good solution to realize the values. This can be achieved based on Article 183 (Chapter X) of China corporate law. This also requires help from the Chinese government. AgFeed Industries Inc (stock ticker was FEED) is a good example of how China assets can be sold to realize the value for the US shareholders:
On behalf of the many hard-working, mostly middle class US citizens who have lost a significant portion of their retirement funds and assets investing in Chinese company stocks that were allowed to list on the US Stock Exchanges by Wall Street, NYSE, Nasdaq, investment bankers, and promoters, we hope the Media, SEC, and US Government will support and publicize our “Proposal” / Solution as well as make the public aware of this “scandal”.
Again, Please support this “Proposal” / Solution by signing the petition. Thank you.
David Yee, and All similarly situated USA Citizen investors/shareholders of the Problem US Listed Chinese Company Stocks and their Supporters
APPENDIX A – SOURCES AND REFERENCES
The following two reports highlight China's effort in getting US to seize assets of corrupt Chinese officials in the US:
"China seeking help during APEC from US, Canada, Australia in global hunt for corrupt officials"
"China Anti-Corruption Campaign Boosted by Asia Ministers’ Pledge"
Anti-Corruption is the top priority of China as it even used the APEC forum to push for this. It shows that Australia is now cooperating with China and Canada will sign an agreement with China soon. Negotiation between China and the US is still on going.
As soon as possible, Shareholders and their Supporters need the US State Department, Commerce Department, SEC, the President of the United States, and all related US Government agencies who have the power to act and enforce our “Proposal” / Solution.
SAMPLE LIST OF PROBLEM US LISTED CHINESE COMPANIES
DUOYUAN GLOBAL WATER INC.
QIAO XING MOBILE COMMUNICATIONS INC.
REVOKED, 8/23/2012: http://www.sec.gov/Archives/edgar/data/1386607/999999999712012896/filename1.pdf
QIAO XING RESOURCES INC. (Parent of Qiao Xing Mobile Communications Inc., same Chairman/CEO, started out the Nasdaq as Qiao Xing Universal Telephone Inc. on 5/14/1999)
DEER CONSUMER PRODUCTS, INC.
CHINA ELECTRIC MOTOR INC.
FUQI INTERNATIONAL, INC
WEIKANG BIO-TECHNOLOGY GROUP CO., INC
CHINA NORTH EAST PETROLEUM HOLDINGS LTD
CHINA SKY ONE MEDICAL, INC.
YUHE INTERNATIONAL, INC.
A-Power Energy Generation Systems, Ltd.
TELESTONE TECHNOLOGIES CORPORATION
CHINA SUN GROUP HIGH-TECH CO.
DUOYUAN PRINTING, INC.
REVOKED, 10/27/2014: https://www.sec.gov/litigation/admin/2014/34-73431.pdf
- President of the United States
- US Commerce Department
- US State Deparment
US State Department: Implement the "Proposal" with the Chinese Government to Resolve the US Listed Chinese Companies Stock "Scandal".
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