Financial Officers from 23 States Urge SEC to Investigate Delisting Chinese Companies

Financial officers and treasurers from over 20 U.S. states have formally petitioned the Securities and Exchange Commission (SEC) to investigate and potentially delist Chinese companies from U.S. stock exchanges due to concerns over inadequate investor protections and opaque financial practices. The coalition argues that actions by the Chinese government foster an environment susceptible to fraud and abuse, violating disclosure, auditing, and anti-fraud provisions under the Securities Exchange Act. Notable companies under scrutiny include Alibaba, Baidu, JD.com, PDD, Tencent, and NetEase. These state leaders emphasize the risk posed to American investors by the lack of transparency and regulatory compliance of China-based firms listed in the U.S. The SEC is urged to take regulatory action to protect investors from potential financial harm caused by these companies' failure to meet U.S. reporting standards. The coordinated effort highlights bipartisan concern over the risks tied to Chinese equities traded in American markets.