Has 16 Billion Yuan in Funds "Vanish into Thin Air"?

US automotive parts giant First Brands Group filed for bankruptcy at the end of September, declaring liabilities between $10 billion and $50 billion. Reports indicate that the on- and off-balance-sheet financing of First Brands Group amounts to approximately $12 billion.

This bankruptcy case is currently drawing attention from Wall Street and US judicial authorities due to the "vanished funds."

At the same hearing, Raistone, an institution providing short-term financing services, alleged that up to $2.3 billion (approximately RMB 16.38 billion) in funds vanished into thin air during the sudden collapse of First Brands Group.

It is reported that when lawyers for First Brands Group were asked about the whereabouts of the approximately $2 billion the company had raised through factoring, they readily stated, "There is no such money," while emphasizing, "There is only $12 million in the bank account, and no other funds."

The latest news on Thursday also revealed that the US Attorney's Office for the Southern District of New York has taken the lead in investigating the mystery behind the bankruptcy case. The investigation itself does not necessarily mean formal charges will be filed. It is a common move for prosecutors to launch an investigation when public reports indicate significant losses due to irregularities.

According to informed sources, BlackRock has requested to withdraw part of its investment from a fund under Jefferies Financial Group Inc., which has significant exposure to the trade debts of the bankrupt auto parts supplier First Brands Group. BlackRock and other investors, including the Texas Treasury Safekeeping Trust Company, have been in negotiations to partially redeem funds invested in Point Bonita Capital, a unit under Jefferies' Leucadia Asset Management. Point Bonita had invested $715 million in First Brands' accounts receivable, and First Brands stopped payments on September 15.