China Valves Technology (China Valves) came to market via a 2005 reserve merger, listing on the NASDAQ in 2009. It raised US$10m in January 2011 through a placement managed by Rodman & Renshaw. Just a few days later, short-seller Citron Research issued a report alleging fraud. A year later, in February 2012, the company announced that its financials could not longer be relied upon. Auditor BDO resigned in July. It transpired that China Values had been inflating profits by hiding expenses as VAT payments. The SEC investigated and successfully prosecuted management. The company delisted from the NASDAQ in September 2012 and has its listing revoked in March 2015.

Last updated August 2021

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