CHINA -$78 Billion Evergrande Fraud Rocks China & Risk of Property & Finance Sectors Collapsing
Video Summary
The Chinese property developer Evergrande has been accused of fabricating its accounts by $78 billion, including non-existent revenue and non-completed sales. This is a significant blow to the company’s reputation and could have far-reaching implications for the Chinese economy and global markets. The Chinese Securities Regulatory Commission has also accused Evergrande’s founder, Hua Hanfeng, of using misleading financial information to raise funds, including issuing bonds worth 21 billion yuan. The fine imposed on Evergrande by the regulator is 4.18 billion yuan, a record amount. The auditors, PricewaterhouseCoopers, have also come under scrutiny, with the Financial Reporting Council launching an investigation into their handling of Evergrande’s accounts. The potential consequences are massive, with the sector’s 25% contribution to the Chinese GDP at risk. If the allegations are true, it could be the largest fraud in history, surpassing even Enron.
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