The CTO also left Luckin’s luck.

On May 1,media reported that Luckin Coffee (LK.O) Chief Technology Officer (CTO) (CTO) resigned on Thursday for personal reasons and was not involved in luckin’s own financial fraud. Prior to joining Luckin in September 2019, He served as Vice President of JD.com. Luckin has not yet commented on Mr. Ho’s departure.

Mr. Ho also became luckin’s second major executive to leave since he exposed financial fraud. On 23 April, Luckin announced the resignation of Thomas P. Meier, an independent director and member of the Audit Committee.

This may just be the beginning of a wave of departures. Luckin’s fraud is subject to a wave of suspensions, regulations or shop closures, and more executives may leave, which is bound to force more ordinary employees to leave or queue up.

The CTO also left Luckin's luck.

On the evening of April 2, Luckin issued a “self-explosion” in which it admitted to falsifying transactions involving sales of about Rmb2.2bn between the second quarter and the fourth quarter of 2019.

Luckin said that since the second quarter of 2019, Liu Jian, the company’s chief operating officer (COO) and director, and several employees who reported to him, engaged in certain misconduct, including fabricating certain transactions. From the second quarter of 2019 to the fourth quarter of 2019, the company’s board of directors suspended COO Liu Jian and related employees involved in misconduct after sales related to the fraudulent transaction spree amounted to approximately RMB2.2 billion.

After the announcement, Luckin Coffee’s opening plunge of more than 80 per cent triggered a fuse suspension, followed by six fuses in 40 minutes. On the evening of April 7, Beijing time, on the eve of the u.S. stock market opening, Luckin Coffee announced that it was suspended and has not resumed trading. Its market capitalisation has also fallen from a peak of $13bn to $1.1bn at the time of the suspension.

Some analysts believe that the coffee chain, once a Starbucks challenger, has a big chance of exiting the market.

Two months before Luckin’s own explosion, on January 31st Muddy Waters, a well-known shorting agency, issued an anonymous shortreport against Luckin. The 89-page report refers to Luckin’s alleged inflated single-store sales, inflated advertising and marketing spending.

Now, the domino effect of luckin’s financial fraud scandal has followed.

Luckin’s financial fraud has triggered a strong distrust of China’s shares in the U.S. stock market, some analysts believe that Luckin fraud will trigger the chinese general stock market retreat.

Luckin since the exposure of fraud, the United States shorting agencies to learn with whom to learn, good future, Aichi Art and other Chinese shares issued short reports, resulting in the above-mentioned four companies accumulative market value of nearly $13 billion.

Mr. Yu commented that Luckin’s fraud “has had a lot of negative impacton son-in-personimage of Chinese companies and entrepreneurs in the hearts of the world’s people.”

In the U.S., there have been calls to tighten regulation of Chinese companies, and Luckin’s fraud has sparked complaints from U.S. regulators and a crisis of confidence in China’s shares.

“I think it’s worse than the 2.2 billion yuan i’ve exposed, and I don’t believe it’s a man-made fake, ” Carson Block, the founder of Luckin’s murky water, told Tencent’s Money You on April 21. In terms of revenue, it’s going to be more than it’s exposed. How much is this company worth? If the management of this company is making a fraud, I think the value of the company is 0. Of course, other people’s opinions may be different. “

On April 22, executives such as Jay Clayton, chairman of the Securities and Exchange Commission, issued a joint statement on the SEC’s website entitled “Significant disclosure, financial reporting and other risks involved in investing in emerging markets;

According to the New York Times, the Luckin fraud scandal also provides a classic case for lawmakers from both parties in the United States. Among them, Senator Marco Rubio, Republican of Florida, said: “The Luckin coffee scandal is just one of many cases of fraud in China, and it should serve as a wake-up call to policymakers and regulators that it is time to act.” “

It also appears to have been affected by the Luckin fraud scandal, with domestic companies announcing their intention to go ipo in the past month opting for Hong Kong. In the past few years, going to the U.S. has become a fad for Chinese companies, and now it’s a fad because of Luckin’s fraud.

In addition, the Securities and Exchange Commission may be conducting an independent investigation into Luckin, according to media reports.

At home, the luckin-induced earthquake was just as powerful.

On April 3, the CSRC issued a notice saying that it was highly concerned about the financial fraud of Luckin Coffee and strongly condemned the company’s financial fraud, “the CSRC will verify the relevant situation in accordance with the relevant arrangements of international securities regulatory cooperation, resolutely crack down on securities fraud and effectively protect the rights and interests of investors.”

On April 15th the “super-regulator” of financial institutions such as the CSRC, the central bank and the BANK’s insurance regulator, the Financial Stability and Development Committee of the State Council, held a thematic meeting: strengthening investor protection in capital markets. Apparently because of Luckin.

On April 22, Cao Yu, vice chairman of the CIRC, said sternly at the press conference: “Luckin coffee financial fraud incident is of a bad nature, profound lessons, the CBRC will firmly support and actively cooperate with the competent authorities in accordance with the law severepunishment.” “

On April 27th Tencent reported that the CSRC had been stationed in an investigation team for several days in Luckin Coffee, which was embroiled in a financial fraud scandal. In addition, a number of auditors are conducting audits of Luckin’s financial position. Luckin could therefore become the first case of “long-armed jurisdiction”.

On the same day, the CSRC said in response to a reporter’s question: “Since Luckin Coffee’s financial fraud, the CSRC has for the first time expressed its solemn position to the outside world and communicated with the US CsrC on cross-border regulatory cooperation, and the CSRC has responded positively.” The CSRC has always taken a positive attitude towards cross-border regulatory cooperation and supports overseas securities regulators in investigating and prosecuting financial fraud by listed companies within their jurisdictions. “

In just a month, the Chinese coffee chain, known for its crazy store openings and crazy subsidies, has hit rock bottom from the sky, as fast as its speed of light.

Luckin Coffee Limited was incorporated under Cayman Islands law on 16 June 2017.

In October 2017, Luckin Coffee opened its first store in Galaxy SOHO, and in November 2017, Qian zhiya announced that he was stepping down as a director and COO of Shenzhou Auto, leaving the company to start a business and establishing Luckin Coffee.

According to Luckin’s website, the number of direct stores reached 4,507 by the end of 2019.

On April 22, 2019, Luckin Coffee filed a prospectus with the U.S. Securities and Exchange Commission (SEC) for up to $100 million to seek a listing on the NASDAQ Stock Exchange under lk.

It was listed on May 17, 2019. On January 17, 2020, its share price climbed to an all-time high of $51.38, giving it a market capitalisation of nearly $13 billion, leaving it with only $1.1 billion.

Luckin’s luck has run out.