Concerns about accounting irregularities of Chinese companies which are listed abroad has triggered a rout in their stocks. Indiscriminate buying has now given way to distrust.
Like any emerging market, China has its fair share of fraud, scams and corporate governance fiascos, but a spate of scandals at Chinese companies listed in New York, Hong Kong and Toronto is increasingly unsettling investors.
The US is at the centre of the storm. In the past six months alone, more than 25 New York-listed Chinese companies have disclosed accounting discrepancies or seen their auditors resign. Source: Financial Times