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LeEco Boss Jia Yueting Defies Order to Return to China

UPDATED: Jia Yueting, the colorful founder of the struggling LeEco Group, says he cannot yet return to China, putting him in defiance of an order from one of the country’s financial regulators.

In a Dec. 25 instruction, the China Securities Regulatory Commission said it wanted Jia back in China by Dec. 31 to take action over the mounting debts at the sprawling tech and video streaming group. Having missed that deadline, Jia on Tuesday used his WeChat social media account to publish a letter he sent to the CSRC on Dec. 31, in which Jia says he cannot return to China while he is making good progress on the refinancing of electric cars company Faraday Future in the U.S.

“The fundraising for Faraday Future in the United States is making significant progress and there are many tasks I need to push forward in order to ensure the production and timely delivery of the [latest model] FF91,” Jia said. In previous blogs, Jia had suggested that if he returned to China he feared not being allowed to return to the U.S. where Faraday’s future is likely to be decided.

In the new posting, Jia said he had asked his wife and his older brother, Jia Yuemin, also a board director of listed unit LeShi Internet Technology, to meet with the CSRC. Jia’s wife, Gan Wei, appeared to land in Beijing on New Year’s Eve, posting messages on her Weibo social media account from the airport, and saying that she was back with a mission. That left it unclear whether Jia himself had returned or defied the CSRC order.

Lawyers have pointed out that Jia’s defiance of the CSRC’s instruction may have civil, rather than criminal implications. But Jia’s problems at home are mounting.

In mid-December, he was placed on China’s list of debt defaulters and on a national blacklist. By the end of the month a court announced that it had seized substantially all of his assets in China. In his message, Jia points to a missed debt payment in July last year that triggered an asset freeze and multiple other calls for debt repayment. The mounting cash problems mean the shutdown of nearly all the group’s non-listed companies and the layoff of 10,000 staff.

Jia also pointed to supply-chain shifts in the phone handset market in 2016 – LeEco group company Coolpad manufactures phones for other brands as well as the company’s own LeEco phones – that had a ripple effect across the consortium.

Jia recently announced a $1 billion cash lifeline for Faraday Future. But one of the purported investors, Thailand’s leading energy group, PTT, denied its involvement.

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