Friday, February 25, 2011

Trouble Ahead: China's eBay, Alibaba

Alibaba announced two of its most senior representatives, David Wei, the chief executive, and Elvis Lee, the chief operating officer, would resign to accept responsibility for the company having granted "golden status" to 2,236 dealers who it says had subsequently defrauded buyers.

Although the two executives were not personally implicated, the company had little choice than to accept their resignations and make a public disclosure about what happened.

Read all about it:

An online-fraud scandal in China:  Alibaba and the 2,236 thieves
The Economist (check out this December 2010 article as well)

Why Alibaba's CEO had to go
Fortune Tech CEO Resigns in Wake of Fraud by Sellers

David Wei and Elvis Lee Quit Alibaba Amid Fraud Inquiry

I think this is only the tip of an iceberg ... watch it closely.

1 comment:

Jonathan said...

wow--this is huge. I am curious how this news will affect other business relations between the Western world and China since Ali Baba is one of China's most recognizable and visible business institutions. A confidence had been built that that will now lead to interesting developments I'm sure. This story is rich though--only by sacking the two most senior uppers could the company attempt to save face.