Tim ... my belief is that lies cannot perpetuate forever which means there is hope in this sector. As these companies mature, start paying dividends (like XIN today), I don't think these liars continue to be successful? What kills me is we don't know what the issue is with CCME and have not heard any reply from the company.
One crazy speculative thought that just came to mind, which I don't think has been raised here (and contradicts my optimism), is the possibility that CCME bribed the goverment for its status (where the operations of the company are legit). Short sellers have accused CCME of everything but this ... perhaps they don't want to upset the Chinese government directly by releasing these details but at the same time knew CCME would not pass the audit for these reasons.