By Conor White
After the financial crisis of 2008, a group of investors looking for high-return investments sunk their money into a group of companies in China, only to find that what they thought was a great deal was potentially the biggest case of financial fraud in the last 25 years.
"What they discovered was these companies were not what they said they were," explained Jed Rothstein, director of 'The China Hustle'. "Some of them were complete, outright Potemkin village frauds, some of them were hugely misrepresenting their profits and their assets, and at the end of the day the guys in the film discovered that $50 billion was taken from investors here in the U.S."
In an interview Friday on Cheddar, Rothstein said it's still happening.
"According to the short-sellers, who are sort of the main characters in the film, there are a number of these companies still out there."
Despite uncovering the scam, investors have no way of getting their money back, punishing those who concocted it, or even stopping it.
"We really need to bring the regulatory regime up into the 21st century," argued Rothstein. "And that's going to be a pretty heavy lift in the current political environment where their main aim seems to be removing the regulations that we do have in place."
View the full segment here.