(MENAFN- AFP) Controversial Chinese solar energy firm Hanergy Thin Film Power Group is facing a legal bid by Hong Kong's securities watchdog that seeks to ban its directors for up to 15 years.
Company founder Li Hejun -- once listed as China's richest man -- stepped down as chairman in May, almost a year after shares in the firm imploded on the Hong Kong stock exchange, plunging 47 percent in less than half an hour.
That drop wiped $19 billion off Hanergy's market capitalisation, prompting a trading suspension on its shares since May 2015.
Hong Kong's Securities and Futures Commission (SFC) in a statement released late Monday said the firm's five directors, including Li, had "failed to question the viability of Hanergy's business model" which relied on sales to its unlisted mainland parent Hanergy Holding Group Limited and its affiliates as its main source of revenue.
The SFC statement said the directors also failed to recover "receivables" and "did not act in Hanergy's best interest".
"The legal proceedings were commenced under ... the Securities and Futures Ordinance, under which the court may make orders to disqualify a person from being a director or being involved ... in the management of the corporation for up to 15 years," the statement added.
The firm captured the attention of investors after growing more than sixfold to become the world's largest solar power company by market value ahead of the collapse.
The meteoric rise in share price once gave Li the title of China's richest man, according to one wealth survey.
The collapse of Hanergy and some other top-performing stocks in the southern Chinese city's stock market had prompted critics to question the regulators' oversight.
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