Seattle-based L&L Energy, which operates coal mines in China, was sued Thursday by the Securities and Exchange Commission (SEC), and CEO Dickson Lee was charged by federal prosecutors with making false regulatory filings.
The SEC’s civil complaint alleges L&L “created the false appearance that the company had a professional-management team in place when in reality Dickson Lee was single-handedly controlling the company’s operations,” according to an SEC statement.
The false claims in 2008 and 2009 included using the name of a CFO who was not actually working for the company, according to the complaint. The false filings helped L&L gain a listing on Nasdaq.
The criminal case, filed by the U.S. Attorneys office in Seattle, is based on parallel allegations, the SEC said in a statement.
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“Lee and L&L Energy deceived the public by falsely representing that the company had a CFO, which is a critical gatekeeper in the management of public companies,” said Antonia Chion, associate director in the SEC’s Enforcement Division.
The actions don’t address claims raised last September by short sellers who questioned L&L’s reporting of its operations in China.
The SEC said its investigation is continuing.
Nasdaq halted trading of the company’s stock in November.
Rami Grunbaum: 206-464-8541 or email@example.com