PEZ (ASX) the china hustle

Originally posted by dumbbum ↑

An extract from ASIC report I filed today.

"Give a brief description of what happened :
I suspected the cash balance might not be real so I attended the 2016 annual general meeting and was assured by the chairman Mr David Wheeler that the cash was real as set out in the annual report.I also asked the company auditor who was present at that meeting and he assured me that he had verified that the cash existed and that the amount stated in annual financial report was correct.I also raised many questions during the meeting including: Why were they proposing to carry out a share issue when they had so much cash at their disposal. Why were they proposing a borrowing facility when they had a substantial cash balance. Why was one of the directors holding patents valued at $2 million dollars when they should have been registered in company's name.Also I question the close relationship between directors David Wheeler and Jack James who were supposed to be independent directors.The answers I received were unconvincing .Another issue was the only person there involved in the running of the china end of the business was a director who didn't speak English. When the chairman could not answer the question an interpreter got involved and the answers came back vague and dismissive.Now we have a mess where creditors seeking repayment of $9million in loans has resulted in the company being put in liquidation.Further more the directors have taken the company records out of Australia and out of reach of the liquidator. Then to add insult to investors the directors have transferred the shares of the subsidiary company that owns the key assets to who knows where.This is clearly a fraud of some sort. As background to what we may be dealing with here I refer you to a recent Netflix documentary entitled "The China Hustle ". The essence of this revealing report is that China has no interest in prosecuting Chinese nationals for crimes committed outside china. So Chinese businesses folded into western listed companies reported actual results to the Chinese authorities and reported whatever they thought the investing public would get excited about to the foreign jurisdiction"

At the meeting I attended there was only one other shareholder in attendance and a room full of fee takers such as lawyers,auditors, Australian directors, accountants.Before the meeting commenced I briefly discussed my issues with the other shareholder however he was very naive and supported the directors. He later posted in hotcopper disparaging remarks about a shareholder stirring the pot.Funny that.

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What a farce!