Chinese Firm Overstates Cash by $4.3 Billion Using False Documents

One of China’s largest listed drug makers that’s been under a regulatory probe for months said it overstated cash positions after using false documents and transaction records. The stock tumbled by the 5% daily limit.

Kangmei Pharmaceutical Co., a producer of traditional Chinese medicines, said in a filing on Wednesday that such methods have led to an overstatement of cash holdings by 29.9 billion yuan ($4.3 billion). The company admitted to “serious” deficiencies in its corporate governance and internal controls, according to the filing.