The first time I read any documents regarding Maj's CGPI investigation was the day of the CC, when he called me and inquired if I wanted to help out. By that point I had already sold all my shares as I had posted here.
Regarding what you call 'insider trading', if someone investigates something in the public domain and tells other people about it, they can certainly trade on that information! It is different if the information is given away by someone FROM company management and the source is from an "insider" but in this kind of scenario I think we are far far away from any SEC problems.
Regarding giving the company a chance to reply, I believe Maj has been more than fair. His article indicates he is in contact with IR and the company trying to resolve these issues. I have no doubt that when he publishes his full findings, he will include their responses regarding each issue and it will be up to each investor to consider the issue and if their explanation makes sense. The thing is, the things he said in the article are facts (I don't think he did much "interpretation"). There have been very serious failures in the disclosures the company has made in its SEC filings at the very least. The corporate structure currently disclosed is simply incorrect for example. The company can correct some of the issues but the fact remains that they have been inept and provided insufficient transparency (Most benign interpretation).
I'm a large bull in the US-Listed China space but frankly my interpretation of the investigative findings was much more negative than what Maj portrays in his article. I thought he was being extremely considerate of the company and IR in the words he chose to use.
Regarding LTUSD, ive been negative the company for over a year, well before Maj's investigation there... Never shorted it as the evaluation is simply too low but buy it? No way. Regarding the appraisal, I believe it was obtained from a government agency. Whether that appraisal is "realistic" of current market realities is something I cannot comment on... The company is supposedly going to sell that land now and recoup the cash, we shall see how accurate the appraisal was if they manage to sell it. I suggest you investigate LTUSD further, there are other lemmings in THAT closet than simply the land appraisal issue.
I am sorry if you lost money in either name but frankly you are playing with the high end of the risk spectrum in the US-listed China names when you invest in either of these two companies (IMO). If you continue to pick companies like these, it seems you would be a prime candidate for Maj's investigation-subscription service when it is launched as a way to conduct further DD. Personally I will certainly be a part of his service (and help him with whatever he needs when I can) since I want to be able to sleep at night holding large amounts of money in these China securities. The more information we get, the more we force companies to disclosure, the harder we look...The healthier the space becomes and the higher the PE goes (IMO).
-Fernando
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