YXL Rare Earth and YXL Refractory Materials, Subsidiaries of CRE, Under Investigation for Financial Misconduct and Debt Issues
Reuters
Aug 29
YXL Rare Earth and YXL Refractory Materials, Subsidiaries of CRE, Under Investigation for Financial Misconduct and Debt Issues
Yixing Xinwei Leeshing Rare Earth Company Limited and Yixing Xinwei Leeshing Refractory Materials Company Limited, key subsidiaries of China Rare Earth Holdings Limited $(CRE)$, are under scrutiny due to significant financial irregularities. These subsidiaries reportedly owe substantial judgment debts to various PRC banks and corporations, amounting to approximately RMB258,000,000 and RMB260,000,000, respectively. Concerns have been raised over false representations during their annual audits for the financial years 2023 and 2024, where undisclosed loans were inconsistent with their purportedly strong financial positions. Additionally, ongoing enforcement actions have yet to be completed, suggesting a lack of enforceable assets to meet repayment obligations, raising suspicions of potential misappropriation of funds by management. These developments have led to an independent investigation committee being formed to address these serious issues.
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