A bipartisan group of U.S. lawmakers is urging the Securities and Exchange Commission (SEC) to take action and delist Chinese companies that are not in compliance with U.S. auditing standards. The lawmakers, including Senator Marco Rubio and Representative Mike Gallagher, argue that these companies pose a risk to American investors due to the lack of transparency and potential for fraud.
They specifically point to the Holding Foreign Companies Accountable Act (HFCAA), which requires foreign companies listed on U.S. exchanges to allow the Public Company Accounting Oversight Board (PCAOB) to inspect their audits. If a company fails to comply for three consecutive years, it faces delisting.
The lawmakers contend that despite some progress in allowing PCAOB inspections, risks remain. They cite instances of Chinese authorities obstructing access to complete audit information, raising concerns about the reliability of financial reports from these companies. They believe that delisting non-compliant companies is crucial to protecting U.S. investors and maintaining the integrity of American capital markets. The letter emphasizes the need for the SEC to consistently and effectively enforce the HFCAA.
find the original article here: https://finance.yahoo.com/news/us-lawmakers-urge-sec-delist-214408823.html