Chinese pork producer, Zhongpin, listed in the US via a reverse merger in 2006. In July 2011, an article was published in the China Economic Review which claimed that channel checks suggested Zhongpin was materially overstating its revenues and profits. Next month, in August, short-seller GeoInvesting claimed that Zhongpin's profits were overstated by 5x, with faked profits likely washed through the financials via overstated capex. Later that same month, short-seller Alfred Little claimed that a reported subsidiary had never made a profit and went out of business in 2008. Ten months after the first allegations were made against Zhongpin, in March 2012, the company announced the receipt of a privatisation proposal from its chairman. Although the company was finally taken private in June 2013, the chairman and other were prosecuted for insider trading prior to the privatisation announcement. Although Zhongpin's financials had traits in line with past frauds, the allegations remain unproven.

Last updated November 2021

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