Oil producer China North East Petroleum entered the US market through a reverse merger in 2004. Restatements in 2010 were followed by SEC proceedings over money diverted to insiders and undisclosed related-party transactions. In September 2016, a US court entered judgment against the company, its chief executive and its founder after they failed to defend the civil case. The judgment established fraud in the diversion of funds and related disclosures. GMT also suspects that the company fabricated operating profits, but that wider view was not established by the judgment.

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