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Hong Kong

The investment scam

Hong Kong, 1 July 1999

It looks like the upcoming Initial Public Officering (IPO) for the Hong Kong-based company will be quite a scam.

The fledgling internet service provider and company is attemtping to portray itself as a hot investment concept, by combining "Internet" and "China" into a single stock offering.

However, according to a 30 June 1999 article in the New York Times, the company has never made any money, and in 1998 even reported losses of $ 11 million on a revenue of $3.4 million ("By any other name, could be so confident?", New York Times, 30 June 1999)

Another important drawback of is that the PRC's government news agency Xinhua holds a 13.6 percent stake in the internet portal, controlling all its news content, and systematically deleting any references to Tibet and Taiwan.

The New York Times article also quotes Kenneth Farrell, an expert on Internet in China, as saying that has never been a factor on Internet business in China, "It doesn't even register on the radar screen." intends to raise $56.3 million through an IPO on the NASDAQ stock market in two weeks. It is to be hoped that few people fall for this scam.