Stories like these are going to become increasingly common. Chinese companies are completely opaque and the SEC cannot easily audit Chinese companies. It's easy to rip off Western investors as the power structures lean towards Chinese citizens, always. Their entire business structure is built with the Chinese first and everyone else second.
Is there any special treatment to allow Chinese companies doing this? If not, I'm afraid this kind of fraud would apply to many business across the globe. Proper conclusion drawn from this incident is that loophole revealed in such case should be fixed to protect investors.
SEC statement: https://www.sec.gov/news/public-statement/statement-vital-ro...