China’s Securities, Markets Regulators Launch Probe Into Luckin
What’s new: The China Securities Regulatory Commission and the State Administration for Market Regulation have opened a probe into Luckin Coffee Inc., the U.S.-listed coffee chain that admitted to massive financial fraud earlier this month.
Officials from the market regulator visited Luckin's Beijing headquarters on Sunday morning and reviewed documents and questioned employees until the evening, a source at Luckin told Caixin.
Luckin issued a statement Monday afternoon saying it was cooperating with the investigation, and that its stores continued to operate normally.
What’s the background: Luckin shocked investors earlier this month when it disclosed that nearly half of its reported revenue for the final three quarters of last year might be fake, blaming its chief operating officer and some of his employees for the fraud.
The U.S. securities regulator is seeking China's help in investigating the company, since Luckin's operations are all in China and thus beyond the American regulator's jurisdiction.
Quick Takes are condensed versions of China-related stories for fast news you can use. To read the full Caixin article in Chinese, click here.
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