Geoinvesting published a report claiming fraud in LPIH in January 2013. The report stated:
Longwei was engaged in the wholesale distribution of finished petroleum products in the PRC. LPH’s headquarters were located in Taiyuan, Shanxi Province, adjacent to and overlooking its Taiyuan fuel storage facility. Geoinvesting’s report argued 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.
Subsequently, China’s Daily Economic News published a report confirming that that key production facilities were not functioning at. The SEC brought charges against LPH and its CFO in 2016.
PPE/sales low and RoPA at 85% was 98th percentile in 2012
Longwei Petroleum: Annual Report 2012