China Medical Systems (CMS) was attacked by Blue Orca in February 2020 alleging that the company faked approximately half of its profits in China which were being washed through a Malaysian subsidiary. CMS denied the allegations. The report failed to prompt any board or auditor resignations. In March 2021, CMS released FY19 financials which showed substantially higher tax charges in Malaysia. CMS stated that the tax rate rose because its Malaysian subsidiary did not meet economic substance requirements following tax rule changes (i.e. the Malaysian operation was probably little more than a letterbox for tax reasons). The Malaysian business has now been effectively closed. As such, Blue Orca's allegations remain unproven. 

Last updated September 2021

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