The mighty, fallen

Heads are rolling into Hong Kong harbor. Larry Yung and Henry Fan, the top dogs at CITIC Pacific, resigned from their posts yesterday, the latest casualties of the firm’s forex hedging scandal of yesteryear (also known as last year). Notably, their resignations came just five days after CITIC’s Hong Kong headquarters were raided by police investigating alleged false statements and fraud. Meanwhile, another mighty China business entity, Ping An Insurance, is experiencing the agony of defeat. The company posted a 2008 loss of US$435.9 million, its first annual pre-tax loss since listing in 2004 and a far, bitter, plaintive cry from the US$3.2 billion profit posted in 2007. The damage was caused by a disastrous US$3.5 billion investment in the now-dismantled European investment group Fortis. And one Chinese businessman is sitting on the hot seat. Li Fangwei, who runs LIMMT Economic and Trade, the company recently indicted for alleged transfer of missile and nuclear technology to Iran, said his products were not intended for military use. He added that his contact with Iran has been limited after being twice censured by Chinese authorities and having his offshore assets frozen by the US. This guy might want to hire a real lawyer right about now.