Luckin Coffee – Financial Treason & Crime

Dean Seal, 08 March 2021

Luckin Coffee and a proposed class of its investors told a New York federal judge that they are working toward a potential resolution of claims that the Chinese coffee chain used “sham transactions” to fake hundreds of millions of dollars in sales.

The parties received approval on Friday from U.S. District Judge John P. Cronan for certification of a settlement class of investors who acquired Luckin securities between its initial public offering in May 2019 and July 2020, when a Cayman Islands court appointed joint provisional liquidators to oversee Luckin’s operations and negotiate with its creditors. Continue reading “Article: Luckin Coffee Investors Work Toward Stock Suit Settlement”

03/08/2021

Article: China cracks down on fraud and tries to clean up image with Luckin probe

Article - Media, Publications

China cracks down on fraud and tries to clean up image with Luckin probe

Evelyn Cheng, 25 February 2021

In a period fraught with tensions with the U.S., China is trying to show it’s being serious about tackling fraud. Nasdaq-listed Luckin Coffee said Monday it was cooperating with regulators, following reports of government investigation into the company over recently disclosed financial fraud.

The rare crackdown comes after an update to China’s securities law took effect in March. A new clause said the Chinese government will take legal action against overseas securities issuance and trading activity that hurts domestic investors. Continue reading “Article: China cracks down on fraud and tries to clean up image with Luckin probe”

02/20/202102/20/2021

Investor: Jim Chanos

Investor

James S. Chanos (born December 24, 1957) is an American investment manager. He is president and founder of Kynikos Associates, a New York City registered investment advisor focused on short selling. A noted art collector, he appeared on the BBC Four documentary The Banker’s Guide to Art.

Biography

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12/17/202003/08/2021

Article: China’s Luckin Coffee fined $180m for accounting fraud

Article - Media, Publications

China’s Luckin Coffee fined $180m for accounting fraud

Pat Sweet, 17 December 2020

The company, founded in 2017, was one of the few Chinese companies listed on the US NASDAQ exchange until it de-listed in July this year following the admission of a series of financial scandals. The US regulator said its investigation found Luckin had defrauded investors by materially misstating the company’s revenue, expenses, and net operating loss in an effort to falsely appear to achieve rapid growth and increased profitability and to meet the company’s earnings estimates.

The SEC alleged that, from at least April 2019 to January 2020, Luckin intentionally fabricated more than $300m in retail sales by using related parties to create false sales transactions through three separate purchasing schemes. Continue reading “Article: China’s Luckin Coffee fined $180m for accounting fraud”

08/22/202003/08/2021

Article: A famed short-seller explains why he’s betting big against a Chinese tech stock that has seen a ‘crazy stupid’ 320% gain in 2020

Article - Media, Publications

A famed short-seller explains why he’s betting big against a Chinese tech stock that has seen a ‘crazy stupid’ 320% gain in 2020

Saloni Sardana, 22 August 2020

Famed short-seller Andrew Left is aggressively shorting a “crazy stupid” Chinese stock that has gained more than 320% on the New York Stock exchange in 2020, as he believes it has exaggerated its earnings and will eventually be delisted. The activist short-seller and founder of Citron Capital, told Business Insider that he believes that the earnings of GSX Techedu are grossly inflated “anywhere between 50 to 80%.” GSX, which is an online education provider, has surged despite a number of claims by various short-sellers casting doubt on the company’s performance. Continue reading “Article: A famed short-seller explains why he’s betting big against a Chinese tech stock that has seen a ‘crazy stupid’ 320% gain in 2020”

06/29/202003/08/2021

Article: Coffee’s for Closers: How a Short Seller’s Warning Helped Take Down Luckin Coffee

Article - Media, Publications

Coffee’s for Closers: How a Short Seller’s Warning Helped Take Down Luckin Coffee

Jing Yang in Hong Kong, Juliet Chung in New York and Julie Steinberg in London, 23 June 2020

In January, days after the shares of Luckin Coffee Inc. hit a record high on the Nasdaq Stock Market , giving the company a $12 billion valuation, a cryptic email arrived in the inboxes of multiple short sellers. “A new generation of Chinese Fraud 2.0 has emerged,” it said. “Companies that start off as fundamentally and structurally flawed business model [sic] that evolves into fraud.” The author offered to share customer receipts and videos from Luckin Coffee outlets, attached a long report about the company and said the short sellers could publish and take credit for it. Continue reading “Article: Coffee’s for Closers: How a Short Seller’s Warning Helped Take Down Luckin Coffee”

04/03/202005/06/2020

Release: APRIL DEADLINE ALERT The Schall Law Firm Announces the Filing of a Class Action Lawsuit Against Luckin Coffee Inc. and Encourages Investors with Losses in Excess of $100,000 to Contact the Firm

Release

APRIL DEADLINE ALERT: The Schall Law Firm Announces the Filing of a Class Action Lawsuit Against Luckin Coffee Inc. and Encourages Investors with Losses in Excess of $100,000 to Contact the Firm

3 April 2020

The Schall Law Firm, a national shareholder rights litigation firm, announces the filing of a class action lawsuit against Luckin Coffee Inc. (“Luckin” or “the Company”) (NASDAQ: LK) for violations of §§10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder by the U.S. Securities and Exchange Commission.

Read full release.

03/09/202005/06/2020

Release: LK DEADLINE NOTICE Pawar Law Group Reminds Investors of Deadline in Securities Class Action Lawsuit Against Luckin Coffee Inc. LK

Release

LK DEADLINE NOTICE: Pawar Law Group Reminds Investors of Deadline in Securities Class Action Lawsuit Against Luckin Coffee Inc. LK

9 March 2020

Pawar Law Group announces that a class action lawsuit on behalf of shareholders who purchased shares of Luckin Coffee Inc. (NASDAQ:LK) from November 19, 2019 through January 31, 2020, inclusive (the “Class Period”). The lawsuit seeks to recover damages for Luckin Coffee Inc. investors under the federal securities laws.

Read full release.

02/14/202005/05/2020

Release: INVESTOR ALERT Law Offices of Howard G. Smith Announces the Filing of a Securities Class Action on Behalf Luckin Coffee Inc. (LK) Investors

Release

INVESTOR ALERT: Law Offices of Howard G. Smith Announces the Filing of a Securities Class Action on Behalf Luckin Coffee Inc. (LK) Investors

14 February 2020

Law Offices of Howard G. Smith announces that a class action lawsuit has been filed on behalf of investors who purchased Luckin Coffee Inc. (“Luckin Coffee” or the “Company”) NASDAQLK securities between November 13, 2019 and January 31, 2020, inclusive (the “Class Period”). Luckin investors have until April 13, 2020 to file a lead plaintiff motion.

Read full release.

09/19/201903/08/2021

Article: Short Sellers Piling Into Chinese Stocks As Trade Tensions Rise

Article - Media, Publications

Short Sellers Piling Into Chinese Stocks As Trade Tensions Rise

Wayne Duggan, 19 September 2019

Trade tensions between China and the U.S. are once again on the rise over President Donald Trump’s threats to ban TikTok and WeChat in the U.S. starting on Sunday. With the November election now only about six weeks away, S3 Partners analyst Ihor Dusaniwsky said short sellers are targeting Chinese stocks in a major way.

Dusaniwsky said China and Hong Kong short interest now totals $104 billion, an increase of $2.03 billion in the past month. The dispute between Trump and China over TikTok could be a preview of what’s to come between now and the election, and short sellers seem to believe Chinese stocks could suffer. Continue reading “Article: Short Sellers Piling Into Chinese Stocks As Trade Tensions Rise”

02/05/201103/08/2021

Article: Exposed by a Short Seller, Luckin Coffee, another Chinese Company that Defrauded US Investors, Filed for Bankruptcy in New York Today

Article - Media, Publications

Exposed by a Short Seller, Luckin Coffee, another Chinese Company that Defrauded US Investors, Filed for Bankruptcy in New York Today

Wolf Richter, 05 February 2011

Luckin Coffee, a Starbucks imitator and one of many Chinese companies with no operations in the US that have their IPOs in the US and raise funds in the US, filed for Chapter 15 bankruptcy in New York today. The downfall of Luckin was triggered by short seller Carson Block of Muddy Waters that published detailed allegations on January 31, 2020, of massive fraud at the company, perpetrated at the highest levels.

By the time the Muddy Waters report came out, the company’s stock – well, American Depositary Receipt (ADR) – had skyrocketed from the IPO price of $17 a share in May 2019, to $50 a share in January 2020, giving the company a market capitalization (share price times shares outstanding) of $12.6 billion. Continue reading “Article: Exposed by a Short Seller, Luckin Coffee, another Chinese Company that Defrauded US Investors, Filed for Bankruptcy in New York Today”