Luckin apologizes to staff after month-long fraud tumult  · TechNode

Embattled Chinese beverage chain Luckin Coffee issued an apology letter to its employees on Tuesday evening for the upheaval following its stunning fraud admission in early April.

Why it matters: Luckin had remained relatively silent about its moves following the April 2 disclosure of fraud to the US Securities and Exchange Commission. The apology and appointment of new leadership on the same day mark a distinct change in leadership style.

  • The company on Tuesday fired CEO Qian Zhiya and COO Liu Jian from their positions.

Details: “We would like to express our sincere apologies for all the troubles the incident has brought upon your family,” the company said in a letter addressed to its employees on Tuesday, according to Chinese media reports.

  • The company said that it is grateful to its employees for their hard work in maintaining normal operations of stores, supply chain, and product innovation during a difficult time.
  • The board has appointed Guo Jinyi as acting CEO of the company to oversee the firm’s daily operations as the fraud investigation continues.
  • Like his processor Qian Zhiya, Guo was also formerly an executive with Car Inc., the car rental firm backed by Luckin chairman Lu Zhengyao.
  • Wu Gang and Cao Wenbao were named as new Luckin board members.
  • The Starbucks challenger also pledged in the letter to restructure the company and rebuild its values under its new leadership.

Context: Luckin disclosed in early April that its COO had fabricated around $310 million in sales in 2019, triggering a plunge in share price of around 80%.

  • US regulators, as well as China’s top market regulators, have launched probes into Luckin Coffee.

Emma Lee is Shanghai-based tech writer, covering startups and tech happenings in China and Asia in general. We are looking for stories related to tech and China. Reach her at
More by Emma Lee

Source link

What do you think?

Written by Aakash Malu


Leave a Reply

Your email address will not be published. Required fields are marked *





Covid-19 casts a spotlight on startups in intellectual property businesses

India overtakes China in Q1 2020 fintech funding: Report