China High Speed Transmission Group Initiates Legal Action for RMB 6.64B Misappropriation
China High Speed Transmission Group Takes Legal Measures
In a significant development, the Board of Directors of China High Speed Transmission Equipment Group Co., Ltd. has initiated legal proceedings to address the misappropriation of a staggering RMB 6.64 billion. This decision reflects a strong commitment to the integrity of the organization and the protection of shareholders' interests.
The Details of the Legal Proceedings
The legal action, filed in the High Court of Hong Kong, involves the Group's wholly-owned subsidiaries including Nanjing High Accurate Drive Equipment Manufacturing Group Co., Ltd., Nanjing Handa Import and Export Trade Co., Ltd., and Nanjing Shengzhuang Supply Chain Co., Ltd. This case has been registered as writ of summons, denoting serious allegations remain against several key defendants.
Identifying the Defendants
This legal action targets multiple defendants including Fang Jian, the former Executive Director of the Company, and several entities linked to Fullshare Holdings Limited, including Ji Changqun, who is both the Chairman and Executive Director of Fullshare. Furthermore, the case encompasses 16 additional companies and 10 individuals who allegedly played a part in the unlawful activities that could have significantly harmed the Group's financial standing.
The Allegations at Hand
The essence of the claim revolves around the alleged wrongful conduct that has led to substantial financial losses for the Relevant Subsidiaries. The amount in question, RMB 6.64 billion, represents not only a significant sum but also a pivotal moment for the Group as it endeavors to rectify the situation while advocating for shareholder rights.
Commitment to Accountability
Chairman Hu Jichun has reiterated the Board's seriousness regarding these proceedings. "We are dedicated to taking necessary steps to mitigate damages caused by any misconduct surrounding corporate governance and shareholder values," he stated. The Group underscores its intention to pursue legal pathways that enhance transparency and hold wrongdoers accountable.
Investigations and Findings
Receivables and pre-payments aggregating to RMB 6.64 billion have raised eyebrows. Following a lack of satisfactory responses from the Counterparties, the Group has formally reported these suspicious activities to authorities, leading to ongoing investigations into potential embezzlement.
Independent Action and Discovery
The discovery of significant trading agreements prompted the formation of an Independent Investigation Committee. This Committee is actively scrutinizing the evidence, including commercial records that suggest Fullshare personnel inappropriately influenced the trading activities of the Relevant Subsidiaries.
The Path Forward
The investigation is gathering momentum, with steps being taken towards implementing a robust governance structure within the Group. Key actions include improving cash flow management, implementing oversight measures, and optimizing management functions to prevent future incidences of financial misappropriation.
About China High Speed Transmission Equipment Group
The Group is a well-established entity, recognized for manufacturing high-speed and heavy-duty gears. Originating in 1969 and listed in Hong Kong in 2007, the Group's brand, famously known as 'NGC,' holds a reputable position in both domestic and international markets. The Group's operational focus spans several sectors, including wind energy gearboxes, rail vehicle gearboxes, industrial gearboxes, and more, exemplifying a diversified approach to catering to emerging industry demands.
Frequently Asked Questions
What prompted the legal proceedings by China High Speed Transmission Group?
The proceedings were initiated due to allegations of fund misappropriation amounting to RMB 6.64 billion linked to the Group's subsidiaries.
Who are the key defendants in this legal action?
The defendants include Fang Jian, former executives, multiple entities from Fullshare Holdings, and others involved in financial management.
What has the Group committed to achieve through this action?
The Group is committed to safeguarding shareholder interests and enforcing corporate governance through legal accountability.
What are the Group's measures to prevent future incidents?
The Group is enhancing internal controls, cash flow oversight, and optimizing management to strengthen governance structures.
How has the public reacted to this legal action?
The legal action demonstrates the Group's proactive approach to addressing financial misconduct and protecting stakeholders' interests, garnering support for its governance efforts.
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