NU Online News Service, March 18, 2004, 2:15 p.m. EST – Milberg Weiss Bershad Hynes & Lerach L.L.P., San Diego, has accused China Life Insurance Company Ltd., Beijing, of failing to inform investors about regulatory problems.[@@]
The firm, known for organizing securities class-action suits, has filed a suit in the U.S. District Court in New York that names China Life as the defendant.
The board of China Life has issued a statement challenging the law firm’s allegations.
“We are reviewing the complaint with our U.S. counsel and expect to contest the complaint vigorously,” the China Life board says in the statement.
China Life conducted a wildly successful initial public offering Dec. 22, 2003.
Milberg Weiss alleges in its suit that China Life knew a predecessor company had engaged in “massive financial fraud” but did not disclose that information until Feb. 4, when the National Audit Office of China published adverse audit findings about the predecessor company on its Web site.
The NAO says it found possible evidence of $652 million in accounting irregularities at China Life’s predecessor company, Milberg Weiss says.
Milberg is seeking to represent a class that would include all investors who bought China Life stock between Dec. 22, 2003, and Feb. 3.
The China Life board says in its statement that it has not yet seen the NAO audit report.
“The company will make further announcements as necessary when additional information becomes available,” the China Life board says.
China Life is not aware of any other discloseable matters of a “price-sensitive nature,” the company says.