Asia Plastic Recycling Holding Ltd. (TPE:1337) is being investigated by the Taiwan Stock Exchange for allegedly falsifying its financial records. According to the China Post, the stock exchange sent three people in China to further investigate the accusations against the company.

Asia Plastic Recycling Holding Faces Investigation For Alleged Fraud

The Taiwan Stock Exchange will send the results of its investigation on Asia Plastic Recycling Holding Ltd. (TPE:1337) to authorities and it will release it to the public if necessary, according to its president Michael Lin.

Lin said the three person sent to China will examine the financial situation of Asia Plastic Recycling Holding Ltd. (TPE:1337), and they will also find out whether Glaucus Research Group in manipulating the stock price of the company. The U.S. based research firm released a report that the company overstated its financial records.

Lin added that if the three-member team of investigators found that Asia Plastic Recycling Holding Ltd. (TPE:1337) did not falsify its financial records, the stock exchange will support the company if it decides to file a lawsuit against Glaucus Research.

According to Lin, the regulations in Taiwan do not cover research reports released outside the country, and he recommended that local financial supervisory authorities should sign a memorandum of understanding with their counterparts in the United States.

Asia Plastic Recycling under FSC investigation

The Financial Supervisory Commission (FSC) is also investigating accusations that Asia Plastic Recycling Holding Ltd. (TPE:1337) falsified its financial records. FSC Chairman Ming-chung said the commission is also investigating if Glaucus Research was involved in manipulation of the stock price of the company. According to him, if the investigation found any anomaly, the FSC will report the company for prosecution.

The stock price of Asia Plastic Recycling Holding Ltd. (TPE:1337) declined significantly since Glaucus Research published its report indicating that it overstated its financial results. The research firm stated that the actual earnings of the company were 90% lower than what is reported to the Taiwan Stock Exchange.  The company strongly denied the accusations. The shares of the company closed NT$63.70, down by almost 2%.