STOCKS | Lancang Ancient Tea Discloses Internal Control Crisis After Listing

Lancang Ancient Tea said it had uncovered major internal control problems after its listing, involving alleged misconduct by former senior executives, litigation tied to private lending, and inventory losses. According to Jin10, the Hong Kong-listed company Lancang Ancient Tea (06911.HK) issued two inside information announcements disclosing a series of significant internal control crises. The company said two long-serving senior executives exploited loopholes in remote management to carry out irregular operations. The disclosures said the issues drew the listed company into a private lending dispute involving sums in the tens of millions of yuan, a trade guarantee lawsuit involving 31 million yuan, and substantial losses from tea inventory. The governance problems also triggered a special inquiry from the Hong Kong Stock Exchange, and the report said the market raised strong doubts about the company’s compliance and control capabilities. On July 9, the company said it was carrying out internal rectification, adding that details were still unclear.