Chinese Investment Company Citic Ltd. Under Investigation for Billions in Investor Losses

By Craig Tarasoff

Hong Kong’s securities regulator, the Securities and Futures Commission (SFC), has initiated legal proceedings against Citic Ltd., a Chinese state-owned investment company, and several of its former directors, to compensate investors for massive losses in 2008. Citic invested heavily in the Australian dollar, which subsequently decreased significantly in value resulting in losses of over $2 billion. There are reports that the directors knew of the losses for multiple weeks before disclosing information to investors. The SFC appears to have brought legal proceeding for these events from six years ago,  because if it had waited any longer prosecution would have been barred by Hong Kong’s statute of limitations. The Wall Street Journal has the details.