Hall of Shame

Energy

Longwei Petroleum Investment (LPIH US)

Year: 2013

Longwei Petroleum Investment Holding Limited is an energy company engaged in the storage and distribution of finished petroleum products in the People's Republic of China. The Company's oil and gas operations consist of transporting, storing and selling finished petroleum products, entirely in the PRC. The Company's headquarters are located in Taiyuan City, Shanxi Province. It listed on the NYSE MKT in June 2010

Geoinvesting published a report claiming fraud in LPIH in January 2013. The report claimed that Longwei’s reported sales “were vastly exaggerated.” and stated that LPH’s business size and storage capabilities were massively inflated and this was based on video surveillance of its facilities and interviews of local residents. [1]

Subsequently, China’s Daily Economic News published a report confirming that that key production facilities were not functioning at all; based on a failed inspection by the Safety Inspection Bureau of Shanxi Province in May 2012

The SEC brought charges against LPH and its CFO in 2016. [2]

PPE/sales low and RoPA at 85% was 98th percentile in 2012


[1] Geoinvesting: Longwei Petroleum: The Most Brazen China-Based U.S. Listed RTO To Date, 3 Jan 2013
[2] SEC: SEC Charges Chinese Fuel Storage Company and Its CFO with Fraud; 27 Jun 2016
[2] US District Court Southern District of New York: Legal Documents, 27 Jan 2014
Shareholders Foundation: Longwei Petroleum Investment - Investor Securities Class Action Lawsuit, 4 Jan 2013
Longwei Petroleum: Annual Report 2011
Longwei Petroleum: Annual Report 2012
 


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