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Gome to be audited as new chairman steps in

By Bi Xiaoning (China Daily)
Updated: 2008-11-28 11:33

Gome Electrical Appliances this morning announced that its chairman Huang Guangyu is being investigated by the Beijing Municipal Public Security Bureau "in connection with certain suspected economic crime."

Gome is one of the largest electrical appliance retailer on the mainland and Huang is reputed to be one of the richest men of the nation.

Huang Guangyu, chairman of GOME Electrical Appliances Holding Ltd, gestures in an interview in Beijing in this September 7, 2006 file photo. [Agencies]

In a statement to the Hong Kong stock exchange, on which the company's shares are listed, Gome said the company's chief executive officer Chen Xiao has been appointed the acting chairman.

The company said it was informed of the investigation on Nov 27. It said that it has conducted preliminary internal checks on the assets of the group and the results of these checks have not revealed any misappropriation of the assets and funds.

The company said it will engage external auditors to conduct a risk assessment and carry out a review on the group's connected transactions and the effectiveness of the internal control system.

In the same statement, Zhou Yafei, chief financial officer (CFO) of Gome, is also being investigated by the Beijing public security bureau in connection with the investigation on Huang. Fang Wei has been appointed the acting CFO of the company.

Trading in the company's shares on the Hong Kong stock exchange has been suspended since Monday.