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Consumer Discretionary

Tongxin International (TXIC US)

Year: 2010

Chinese auto parts manufacturer Tongxin listed in the US by means of a 2008 reverse merger. In June 2010, the company announced that its auditor BDO was unable to complete the FY09 audit owing to the uncertain accounting treatment of certain related party transactions. In November 2010, the company lowered its 2010 revenue guidance by a third and removed its CEO Rudy Wilson and CFO Jackie Chang. In December 2010, the company announced civil action against its former CFO Jackie Chang after an internal investigation uncovered the wrongful transfer of US$1.5m of funds as well as other questionable actions. It is not clear if the company was engaged in any form of profit inflation. 

Last updated December 2021

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