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Opinion

Luckin Coffee scandal highlights murky standards of China Inc.

Alleged fraud appears to have been subtler than those elsewhere

| China
Luckin was primarily valued on revenue growth and its ability to show a path to profitability.   © FeatureChina/AP

Nigel Stevenson is an analyst at GMT Research, an accounting research company based in Hong Kong.

Luckin Coffee's revelation that 40% of its sales since the second quarter of 2019 had been fabricated makes it the highest profile Chinese corporate fraud to date and wiped around $5.5 billion off its market value.

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