From The China Post

TAIPEI–The Taiwan Stock Exchange (TWSE, 證交所) sent three people to China Tuesday to further investigate Asia Plastic Recycling Holding Ltd. (亞塑再生) after a recent research report accused the company of falsifying its financial records.

Taiwan’s Financial Supervisory Commission has also been investigating the case of Asia Plastic Recycling, which is incorporated in the Cayman Islands and recycles used plastic bags and waste scraps to produce foam rubber products in China.

Michael Lin (林火燈), president of the TWSE, said the results of his institution’s investigation will be sent to the relevant authorities, and also released to the public if necessary.

The three-member team will determine the company’s financial situation and see if U.S.-based Glaucus Research Group, which issued the research note, was involved in manipulation of Asia Plastic Recycling’s share price, he said.

Once the results prove that Asia Plastic Recycling has not falsified its records, the TWSE will support the company if it decides to sue Glaucus Research, Lin said.

Noting that Taiwan’s regulations do not extend to overseas research reports, Lin said the local financial supervisory authorities should sign a memorandum of understanding with their counterparts in the United States.

The Glaucus research report said that Asia Plastic Recycling had overstated its financial data, adding that the company’s actual earnings were about 90 percent less than it reported to the TWSE.

The research institution has urged investors to sell Asia Plastic Recycling shares and has put the value of the stock at NT$0.

Asia Plastic Recycling is one of 37 foreign-registered companies that have primary listings on the main board.

Since the Glaucus report surfaced in the local media April 24, shares of Asia Plastic have taken a beating, falling by the daily maximum 7 percent in every session and closing at NT$64.90 (US$2.15) Tuesday on the TWSE.

According to its filing with the TWSE, Asia Plastic Recycling, which launched a primary listing on the main board in August 2011, posted NT$6.44 in earnings per share (EPS) in 2013 and NT$8.03 in 2012.

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http://www.chinapost.com.tw/business/asia-taiwan/2014/04/30/406543/Taiwan-Stock.htm