Review: Financial documentary 'The China Hustle' details alleged U.S.-China collusion

Review: Financial documentary ‘The China Hustle’ details alleged U.S.-China collusion

By Gary Goldstein

March 29, 2018 12 PM PT

“There are no good guys in this story, including me,” warns Philadelphia-area hedge fund operator and financial activist Dan David at the start of “The China Hustle,” writer-director Jed Rothstein’s accessible, persuasive, often amusing look at how investments in dubious Chinese companies gave way to crisis-level losses for average American stockholders in the wake of the 2008 financial disaster — and beyond — and made some U.S. bankers and lawyers and Chinese executives a bundle.

David is our de facto guide here in telling this story of purported U.S.-China collusion in selling bad deals via the formation of reverse mergers: in this case, the acquisition of still-public, U.S. shell companies by private Chinese companies. The result was an array of seriously overvalued corporations that legally bypassed the kind of scrutiny — on both sides of the Pacific — that might have quickly shut down the whole shady enterprise.

Although big U.S. investment firms such as Roth Capital Partners and Rodman & Renshaw (both profiled here) cozied up to these China-centric opportunities, “little” guys like David eventually took notice and began short-selling the stocks of these reverse-mergered entities in an attempt to expose their duplicity.

The film, which also features lively talking-head interviews with journalists, bankers, professors, lawyers and others (there are awkward moments with then-Rodman & Renshaw chairman retired U.S Army Gen. Wesley Clark), makes a sound case for greater regulation of financial systems. It also suggests that, under our present administration, Americans will likely see the reverse.

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