China Electric or better known for its lighting brand Toa Lighting in Taiwan issued a statement on Oct. 31, 2016 rebutting Taiwanese media reports about ongoing company financial investigations were exaggerated and fabricated.

Chinese-language media Formosa Television reported recently, China Electric’s chairwoman Li-chen Chou and former general manager Chih-wei Chang were suspected of setting up offshore shell companies and depleted in total NT $140 million (US $4.43 million) from the lighting company.

Prosecutors detained Chang, and the head of the shell company but Chou has gone missing. Authorities are considering to arrest or put the chairwoman on its most wanted list.

Chang and Chou founded two shell companies CLS and GLI, and asked China Electric to transfer NT $140 million to CLS in 2011, but did not list the transaction into its financial results or transaction voucher records.

The two senior executives then invested the transferred funds in their shell company GLI and diluted China Electrics share in the company from 100% to only 40%, clearly violating Taiwan’s financial regulations of submitting consolidated revenue reports that include China Electric and GLI’s earnings. After that Chang further encroached funds from China Electric by asking GLI to repurchase its shares in other companies at a higher price.

China Electric is one of the oldest lighting brands in Taiwan, having a 61 year history. The company is best known brand for its lighting brand Toa Lighting, which has a 30% market share in the lighting equipment market, and reported revenue of NT $2.86 billion in 2015.

In response to this and other media reports, China Electric issued a statement Monday refuting some of the claims in the reports.

“Due to confidentiality of ongoing investigations, it remains unclear to us as to how Taiwanese media were able to acquire unverified information,” stated China Electric. “We sincerely apologize for the negative impact on society and concerns the reports caused shareholders.”

Media reports claiming the US $4.45 million transferred to CLS was not recorded in transaction vouchers or listed in China Electric’s annual earnings constituted suspicious financial activity. The company transferred US $1.5 million to CLS, but the same amount was returned to China Electric in the same year. The company used this to refute media claims that senior managers encroached funds, and insisted they had recorded all transactions. Media reports that the company had not recorded GLI earnings in China Electric’s consolidated reports are untrue, and the company has submitted related documents and data to prosecutors.

The company is fully cooperating with authorities in the investigation, operations and finances are normal and have been unaffected by the investigations, China Electric stated.

Following the release of Taiwanese media reports on Oct. 28, 2016, China Electric’s shares dropped from NT $8.38 on Friday to NT $ 7.44 on Monday morning.