China Rare Earth Holdings (HKG:0769) has appointed Acclime Corporate Advisory (Hong Kong) to conduct an independent forensic investigation into alleged misappropriation of assets, unauthorized transactions, and irregularities at its key mainland subsidiaries, according to an Aug. 8 bourse filing.

The probe follows complaints from former directors and employees over a tungsten bar acquisition from a new substantial shareholder.

It also stems from claims that the group's two main China units, which contributed over 90% of 2024 revenue, have been inoperative for about two years.

These subsidiaries reportedly face 379.6 million yuan in enforcement cases, with much of their stated 596.4 million yuan cash balance unavailable.

The Hong Kong bourse has issued resumption guidance requiring the company to complete the investigation, address regulatory concerns over management integrity, conduct an independent internal control review, and disclose all material information.

Trading in the shares has been suspended since June 18 and will remain halted until the company meets the conditions.

The HKEX may cancel the listing if resumption is not achieved by Dec. 17, 2026, the filing said.