U.S. regulators in China hoping to audit Chinese firms
STEVE CHIOTAKIS: Financial regulators from the United States are in China today, meeting with their counterparts there. Americans are hoping to address a number of accounting irregularities at some Chinese companies publicly traded in New York.
From Washington, here's Marketplace's Scott Tong.
SCOTT TONG: More than 150 Chinese companies have sold shares here the last few years through what are called "backdoor listings." They buy shells of U.S. firms already publicly traded. The back door is faster, less red tape, and legal.
But Ken Lieberthal at the Brookings Institution says for some Chinese firms --
KEN LIEBERTHAL: The information that they are obligated to provide is not accurate.
Scrutiny turned up erroneous books, obsolete accounting numbers, a suspected fake online bank account.
Chinese firms may be developing a reputation in New York, and Lieberthal thinks Beijing doesn't want that.
LIEBERTHAL: The Chinese government has in fact a substantial interest in having the firms that come here behave properly.
In the past Chinese tourists going overseas got trained to stand in line, don't cut, don't spit. The same may apply to Chinese firms that want to go global. Still, how much Chinese riff-raff is there, really? Defenders think Chinese firms are unfairly smeared, and they blame the smearers: They say short-sellers spread rumors and profit when stocks fall.
I'm Scott Tong for Marketplace.