Former SEC Commissioner warns Chinese companies of going to have to put up

The former Securities and Exchange Commission Commissioner Paul Atkins discussed investing in Chinese companies on Wednesday, arguing that those firms are either going to have to disclose information or leave their U.S. listings.

Atkins pointed out a bipartisan bill passed by Congress last year, and spokeswoman for the bill on Mornings with Maria.

The legislation is intended to prevent Chinese companies from listing their shares on U.S. exchanges unless they adhere to America's audit standards.

Atkins noted that the bill gives Chinese companies three years to be able to comply with U.S. rules before being removed from U.S. markets.

According to Reuters, the companies include Alibaba, the tech firm Pinduoduo Inc. and the oil giant PetroChina Co Ltd.

Atkins said that the legislation gives the SEC three years to come up with an issue and Chinese companies to keep up with U.S. standards with respect to auditing, including having their audits open for examination by the SEC and another regulator, The Public Company Accounting Oversight Board, which he explained is responsible for auditors. Chinese authorities have been hesitant to let overseas regulators inspect local accounting firms because of national security concerns.

Atkins claimed that the auditors are stuck between the Chinese Communist Party, which is a controlled government, which is telling them that you may not turn over your working papers to foreign governments unless you say so under criminal penalties and the United States, which requires that documents be open for inspection.

He said it was a real issue, because it's been long-running for maybe almost a decade or so, but that it's finally coming to a head. Atkins stressed that either those companies are going to have to put up or they are going to have to leave their listings here and go elsewhere.