The CEO and COO of Luckin Coffee Fires

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In what can be considered an inevitable movement, Luckin Coffee (NASDAQ: LK) fired the two leaders allegedly linked to a recent scandal. The company announced on Tuesday that it had relieved CEO Jenny Zhiya Qian and chief operating officer Jian Liu of their duties. He also requested and received their resignation as a member of the board of directors.

Last month, it appeared that Luckin Coffee had exaggerated its April-September sales figures by 2.2 billion yuan ($ 310 million). The company opened an internal investigation into the case and suspended Liu. He has since suspended or put six other employees on leave, who he says “were involved in or were aware of the fabricated transactions.” The whereabouts and identities of these people have not been released.

Coffee spilled on a carpet.

Image source: Getty Images.

The internal investigation of Luckin Coffee is not the only investigation into the case. Also in April, media reports said the U.S. Securities and Exchange Commission (SEC) launched its own investigation. This followed a raid on the headquarters of the China-based company in the city of Xiamen by a national regulator, the State Administration for Market Regulation.

In early April, Nasdaq halted trading in the US-listed stocks of Luckin Coffee. This gel remains in place.

Luckin Coffee has already replaced Qian as CEO. Jinyi Guo, a member of the board of directors and executive vice president of the company, is now serving on a temporary basis. The two vacant seats on the board of directors have been filled; Luckin Coffee has appointed company insiders to these positions.

In the press release announcing its steps, Luckin Coffee said it “has cooperated with and responded to regulatory agencies in the United States and China” and added: “The company will continue to cooperate with the investigation internal and to focus on developing its business. “



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