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Paulson & Co. said its investment team conducted “considerable due diligence” on Sino-Forest, including sending one member to China to visit the company’s operations and meet with a customer as well as representatives of the Chinese government.
“We reviewed Sino-Forest’s public filings, participated in conference calls with the investment community, followed up privately with management on specific questions, discussed Sino- Forest with analysts that covered the company, and regularly met in-person with management,” the firm said in the letter.
“We reviewed Sino-Forest’s public filings, participated in conference calls with the investment community, followed up privately with management on specific questions, discussed Sino- Forest with analysts that covered the company, and regularly met in-person with management,” the firm said in the letter.
http://www.bloomberg.com/news/2011-0...his-month.html
This is evidence that even government authorities are involved.
This corroborates with my suspicion that such schemes may involve local governments, state owned banks and maybe even the police - everyone has a share in the money flow.
And assuming even if such companies are real, what is there to stop their managers to absconding with the funds in the future - I'm pretty sure that local officials and even the local police will have a share of the loot by then.
Bottomline, the risk is even higher than investing in ponzis, because there will be no legal recourse whatsoever, you won't get back a single cent.