A U.S. credit ratings company says allegations of accounting irregularities at Chinese companies traded in the United States are likely to continue. Fitch Ratings analyzed 35 U.S.-listed Chinese companies and said in a report Monday that they have an above average risk of facing fraud allegations.
Fitch reviewed the companies after a series of allegations of corporate fraud at other Chinese companies sparked a sell-off in China-related equities.
The review said that negative investor sentiment many continue in the short term as investors identify weak accounting or corporate governance standards at Chinese companies. Fitch's study follows a report from Moody's Investors Service last week which raised similar concerns about Chinese companies.