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China North East Petroleum Holdings Limited Message Board

  • johnnyinphilly29 johnnyinphilly29 May 27, 2010 12:37 PM Flag

    just spoke to IR

    I have a large position in this so I called the contact on the press release

    1) raised the question "do you even know this company exists and is not some made up website propping up nothing?"

    I was told that he has been to the facilties in China and has seen its operations.

    2) I raised an issue with the CEO's mother as a director of the company and how this looked bad. The CEO and his mother were original founders of the firm, and seems that a good bit of the initial capital came from her. I will admit that it looks bad that its "mom" on the board, but I am sure if it was a VC fund, no one would argue with the first source of capital having a board seat.

    3) Also asked about who the hell was running the company. The interim CEO has been involved with the company for some time and a former PetroChina executive. This makes sense since a lot of its business comes from PetroChina.

    I also have to say that having every expenditure over 10,000 to be proved by an audit comitte is a refreshing step, and for the two founders of the company to be punished like this is encouraging. They didnt say they stole money. What the board is saying is even if expenses were used for business purposes the fact that you had them going to personal bank accounts (coupled with poor reporting) does not give the investment community faith, and as a result this behaivor will not be tolerated. To remove the two founding members, fire the CFO (for either approving the bank transfers or not catching them, and establish a 10,000 expense check system is pretty damn quick and punitive. That is at least encourgaing.

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