US research firm Glaucus Research Group alleged that APR's profits were '90% less than reported'. Glaucus advised investors to sell their interests in APR, which recycles plastic scrap such as post-consumer carrier bags, and valued the recycler's stock at zero.
Following a visit to its production base in China by a team of three investigators, the TWSE has concluded that Asia Plastic Recycling, incorporated in the Cayman Islands, 'has not falsified its records'. The review, which included the company's transaction agreements, taxes and accountant certification, concluded that its financial data was 'authentic' and 'based on fact'.
Yet Glaucus maintains that APR has made 'material misrepresentations' regarding the scale and profitability of its business to Taiwanese investors and regulators. The group is 'sceptical' about the initial investigation, which it insists was carried out prematurely and without independent help. 'One day was a public holiday in China where banks, filings offices, tax bureaus, government offices and most corporations are shut down,' the analyst argues.
It is 'entirely insufficient' to simply rely on the very people accused of fraud to provide the documentation. The 'hostile response' to its criticisms will result in a further loss of transparency and loss of confidence on the part of international investors, Glaucus claims.