20120130 Follow Me 264 US reverse merger promoter raided

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US reverse merger promoter raided
By Kara Scannell






US authorities have raided the New York office and home of Benjamin Wey, a promoter of controversial Chinese reverse mergers, according to law enforcement officials.
Agents with the Federal Bureau of Investigation executed search warrants at Mr Wey’s home and New York Global Group, the company where Mr Wey is president, the agency confirmed.
The FBI and Securities and Exchange Commission have been investigating companies involved in reverse mergers.
In these reverse mergers, a non-US company acquired a US shell company to gain a listing on a US stock exchange, bypassing the regulatory scrutiny involved in a traditional initial public offering.
The Public Company Accounting Oversight Board, which overseas US auditors, raised concerns about such companies in 2010. PCAOB and SEC officials have been negotiating with their Chinese counterparts to gain access to auditing papers for companies based in China but have not reached an agreement.
James Doty, chairman of the PCAOB, said, “While I remain hopeful that we will be able to reach a negotiated settlement with the Chinese, the PCAOB cannot, and will not, wait indefinitely. If we cannot reach a resolution in the near term, the PCAOB, in consultation with the SEC, will take further appropriate action to protect investors.”
Reverse mergers are legal, but authorities have been concerned that the process has been abused by companies without legitimate operations. US officials have limited ability to investigate in China so much of their focus has been on the US promoters, auditors, and agents that facilitate the deals.
China-based companies have been particularly active in seeking to list through reverse mergers. Mr Wey is one of the most active promoters in China. He has not been accused of any wrongdoing. A message left at his New York office was not immediately returned.
According to the company’s website, “New York Global Group has a single focus: acting as a liaison between the international capital markets and Asian-based clients.” His firm has more than 200 China-related transactions under its belt.
In 2005, without admitting or denying the findings, Mr Wey agreed to be censured by the Oklahoma Department of Securities for allegedly advising a retired person to invest in a penny stock without revealing that he was a paid consultant to the company.
Longtop Financial, a China-based software provider, said in August it may face civil action from the SEC for failing to provide current financial statements to investors. In September, the SEC sued Deloitte Touche Tohmatsu for failing to produce documents related to its investigation into possible fraud by Longtop.

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关键词：Reverse promote Merger follow Merge companies president Chinese company involve

What a poor guy!
Maybe there are some political causes behind the raid, not just because of the the Longtop case, although the latter may be a critical reason.  It is said that the US closes many industries for Chinese to invest. It may guard qgainst other countries which catch the opportunity of US's in great demand of money to take control of some of its important industries. And it happens to find the reverse merger cases.

这篇文章蛮有深度的，得好好学习

Sometimes when we think about something that is bad about some Chinese investor, or whoever, we always think of politic, but actually we realy should think of what we had done wrong and what we need to do.  In earlier article, it talked about the SEC and PCAOB is more strick on the rules and more care with the RTO because the current deal with China in regards to the inspection on the WP. It's a long way to go until the sun rise again.

When the country is big enough, she can make rules.

Reasonably,  it concerns with responsibility and something else. But why did such a legal country have no rules to sensor something at first?
When the result is not we expected, we try to find someone to take the responsibility. But why do they want to go publich in US at first, not in domestic market instead?
Then, in the investigation process, someone may be the scapegoat. But if the investors are all good ones, will the mediator be a good person? We don't know. After all, he did a lot in the process.

If you were ever engaged in the transaction process of such reverse take-over deals, you will surely be in a better position to make a judgment. It is the interests that play behind the scene, whether it were Chinese co. or US co.

Follow Me: 263, 226
在保护国内投资人方面，中国真应该向美国学习。

Follow Me: 263, 226
在保护国内投资人方面，中国真应该向美国学习。

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