The US Securities and Exchange Commission
(SEC) has warned that criminal charges could be brought on top of
civil proceedings against Chinese companies with accounting
irregularities that are listed on US stock markets.

The US Justice Department is believed to be
investigating accounting irregularities at Chinese companies, says
Reuters. This could involve the high profile Longtop Financial
Technologies case in which audit firm Deloitte China has been
blocked by Chinese authorities from providing documentation to the

Officials from the SEC and the Public Company
Accounting Oversight Board are set to meet with their Chinese
authorities in Washington in October to discuss joint inspections
of Chinese audit firms.

Until an agreement has been reached between
authorities in both countries, it is difficult to see firms in
China obliging with the SEC or the Justice Department in their