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U.S. firm charged of false statement

16 May 2013 04:02 (UTC +04:00)

Baku-APA. The U.S. Securities and Exchange Commission (SEC) on Wednesday charged RINO International Corporation's executives in a scheme to overstate the company's revenues and divert proceeds from a securities offering for their personal use, APA reports quoting Xinhua.

According to the SEC's complaint, RINO filed false and misleading statements about the company's revenue and operations from 2008 to 2010.

RINO maintained two conflicting sets of financial records, one set of books for filings in China and another set of books for filings in the United States. The Chinese books reflected sales of about 31 million dollars from the first quarter of 2008 through the first three quarters of 2010. But the U.S. books portrayed sales revenues of about 491 million dollars during the same time, alleged the SEC.

The SEC said RINO's CEO Dejun David Zou and chairman of the board Jianping Amy Qiu diverted 3.5 million U.S. dollars in company money to purchase a luxury home in California, without disclosing it to investors.

The SEC issued a trading suspension in 2011 against RINO. It is a holding company for subsidiaries that manufacture, install, and service equipment for the Chinese steel industry. The company became public listed in the U.S. market through a reverse merge in 2007.

Zou and Qiu agreed to pay penalties of 150,000 dollars and 100, 000 dollars respectively and disgorged 3.5 million dollars to settle the case.

The settlement is subject to court approval.