Recently released reports state that the founder of Chinese firm LeEco has made his way onto a nationwide list for debt defaulters after he failed to obey a court issued order.
The company has faced a tumultuous year, which has crushed many of its earlier ambitions. In the past, LeEco has been a variety bazar, selling everything from televisions to electric vehicles.
The company grew in popularity and nursed dreams of challenging U.S. tech giants like Apple and Google. Unfortunately, LeEco’s dreams did not correspond with their means.
The company soon faced issues on account of discrepancies in its cash flow. If the reports are to be believed, the company’s bad luck has rubbed off on its founder.
Jia Yueting has been accused of withholding the $72 million he has been ordered to pay to Ping An Securities Group. The order was issued by a Beijing court on September 28.
It is this move on Jia’s part that has led to his subsequent fall from grace. Jia’s name and ID number were included in the public database entry, chronicling the order.
The database, maintained by the Supreme People’s Court, performs the task of blacklisting any individual or corporation that has failed to repay its debts. The institute was launched in 2013 by the Chinese government in an attempt to encourage the rule of law.
Apart from the stain on his reputation, Jia’s entry into the system means that he will now face a number of restrictions. This includes, but is not restricted to, air travel bans.
In July of this year, Jia stepped down from his position as chairman of LeShi Internet Information and Technology, (LeEco’s main listed unit) in order to focus on the company’s automobile unit. At the time, he had issued a public promise to repay all debts incurred by the company.
While the list is certainly a serious issue in China, it is unclear how much it will affect the U.S.-based Jia.
LeEco and Jia are yet to respond to the announcement.