SEC: China Gas Chief Loaned $14 Million To Son And Nephew
Stockholders in China Natural Gas didn't know it at the time, but in 2010, their chief executive was using the company as a personal piggy bank to spin off loans to his son and others. Now, Qinan Ji - the company's former CEO and current board chairman - faces charges by the Securities and Exchange Commission. The SEC is alleging that Ji lined up two short-term loans totaling $14 million for a real estate firm co-owned by his son and nephew, and to another business partner in the firm. The SEC can take the action against China Natural Gas became the company's stock trades in the United States. John M. McCoy III, the SEC's associate director in Los Angeles, said Ji lied to his own board of directors and to regulators about the loans, showing “total disregard” for his obligations to shareholders. The agency wants a final judgment against Ji that includes financial penalties and a ban from being an officer or director of a public company.