Luckin Coffee Scandal: Another Warning for Investors of Chinese Companies

News Analysis

Chinese coffeehouse chain Luckin Coffee announced on April 2 that it had “fabricated” hundreds of millions of dollars in sales figures after an internal investigation.

China’s homegrown rival to Starbucks Coffee saw its New York-listed shares crash by around 75 percent on April 2, after falling as much as 85 percent intra-day. It fell an additional 16 percent on April 3.

In two days, more than $5 billion of shareholder wealth was wiped. Many large investors held Luckin’s stock, including the commodity trader Louis Dreyfus, Melvin Capital Management, Lone Pine Capital, and GIC, the Singapore sovereign wealth fund.

The firm’s chief operating officer (COO) Jian Liu was suspended, along with several other staff, after initial findings from an internal committee discovered fraudulent transactions during 2019 totaling more than 2.2 billion yuan ($310 million). In addition, certain other costs and expenses were also inflated, according to a company press release.

To put those figures in context, during the entire period between January to September 2019 Luckin reported total net revenues of 2.9 billion yuan ($410 million), according to the most recent earnings statements published.

China’s securities regulator—the China Securities Regulatory Commission (CSRC)—also announced its own investigation into the matter. Concurrently, the company told investors that its previously filed financial statements can no longer be relied upon.

This fraud is a huge blow for a company that had become one of China’s most marketable and popular brands. Luckin has been expanding aggressively to more than 4,500 stores and undercutting its biggest rival Starbucks in price. It had forecasted even more growth this year, with plans to build unmanned stores.

Staggering Fall

For some investors, it’s hard to fathom such a steep fall from grace.

Despite being loss-making, Luckin was one of the most hyped IPOs in 2019. It hired Morgan Stanley and Credit Suisse as underwriting bankers and David Polk and Cleary Gottlieb as counsel. Alongside its IPO Luckin also sold shares to Louis Dreyfus, the global coffee bean and agricultural commodities supplier, as another stamp of approval.

Luckin’s shares shot up 20 percent during its IPO on May 17, 2019. And for almost a year, Luckin was the pride of China and counted itself as a legitimate rival for Starbucks.

Luckin’s luck began to turn in January, when investor Carson Block’s hedge fund Muddy Waters published an anonymous report accusing the company of potential fraudulent behavior.

The report outlined evidence that the company may have been inflating its sales figures. Among the evidence presented by the report was store traffic video which did not support the sales figures reported by Luckin. The report also alleged questionable financial dealings such as company management raising cash by pledging almost 50 percent of their own stock as collateral.

Even after the report was released by Muddy Waters, others came to the defense of the company. Another noted short seller, Andrew Left’s Citron Research, said at the time that its own independent research could not corroborate these allegations.

Risk of Investing in Chinese Companies

To astute investors, Luckin’s fall is just the latest in a trend of Chinese companies turning up fraudulent. Any potential investor should hold extreme caution before investing in such companies.

Of course, not all Chinese companies are fraudulent, but there’s heightened uncertainty among Chinese firms due to the policies of the Chinese Communist Party (CCP).

Like almost all other U.S.-listed Chinese firms, Luckin has an onshore-offshore variable-interest entity (VIE) corporate structure. The offshore entity—which issues the stock sold to U.S. investors—is a Cayman Island-registered company. The offshore entity has a contractual agreement with Beijing Luckin Coffee Technology Ltd., an onshore VIE owned by controlled by Luckin’s CEO Jenny Zhiya Qian and Min Chen, which pays fees and royalties to the offshore entity.

An inherent risk of this structure, like at most other U.S.-listed Chinese companies, is that investors don’t hold any ownership in the operating company. Local Chinese executives or the CCP could abandon the offshore entity, leaving American investors high and dry.

Transparency, one of the fundamental pillars of corporate governance, is lacking in most Chinese companies. Beijing does not allow the SEC or U.S. regulators to examine audit work papers of Chinese companies. China claims that the books present “national secrets” which cannot be shared with outside parties.

The risk of arbitrary government interference creates more uncertainty. Chinese companies, even privately owned ones, must implicitly answer to the local CCP bosses and party cells. This is an overhang for every Chinese company no matter where its stock is traded and is a key reason telecom giant Huawei—a privately owned company—poses a national security risk to the United States.

Chinese firms also have an elevated level of related party transactions, a risk that the anonymous report on Luckin laid bare.

The report turned up some other red flags on Luckin. One of the company’s independent board members, Sean Shao, is/was “on the board of some very questionable Chinese companies listed in the U.S. that have incurred significant losses on their public investors,” the report said.

Fei Yang, a Luckin co-founder and chief marketing officer, “was once sentenced to 18 months’ imprisonment for crime of illegal business operations when he was the co-founder and general manager of Beijing Koubei Interactive Marketing & Planning Co.,Ltd. (“iWOM”).” iWOM is a related party—through multiple intermediaries—that currently does business with Luckin, the report alleged.

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Author: Fan Yu


US Carrier Supremacy Faces New Foe in the Pacific: COVID-19

COVID-19 has succeeded where China’s two decades of military buildup has failed—by sidelining a U.S. aircraft carrier in the pacific.

The USS Theodore Roosevelt is currently out of action in a port in Guam, while the crew of over 4,000 is systematically evacuated and quarantined after an outbreak of the CCP virus onboard. The plight of the carrier was first highlighted by a captain in a leaked memo that later got him fired.

This is the scenario that the Pentagon has tried so hard to avoid: a carrier sidelined by a virus breakout, potentially strategic information leaked, and a breakdown in communication stoking the fears of loved ones ashore.

But most analysts offer a reassuring picture, saying that if push came to shove in the pacific, the Navy could shrug off any strategic disadvantages of having the carrier parked up.

If other carriers are hit by further outbreaks, however, most agree that it could have some knock-on effect on the usual clout of the United States in the region.

U.S. carrier groups are the “ultimate insurance policy” that guarantees the freedom and independence of Taiwan, Robert J. Bunker, Adjunct Research Professor at the U.S. Army War College, told the Epoch Times via email. “These groups also allow the U.S. to project its military power and influence throughout the South China Sea in support of its allies, who are being challenged by the expansive and ongoing CCP regime territorial ocean grab taking place.”

China has chipped away at the dominance of U.S. carriers in the pacific by building up an array of long-range missiles and anti-aircraft measures. In response, the U.S. military has been scrambling to reinvent itself for the last two years to tackle the new strategic environment.

But it is too early to know how the virus has impacted the broader strategic dynamic in the area, most analysts say—although there is little sign that China has stopped its saber-rattling and harassment.

The USS Theodore Roosevelt

The plight of the Theodore Roosevelt hit the headlines when a dramatic March 30 memo from Captain Brett Crozier was leaked to the San Francisco Chronicle in which he said that the COVID-19 outbreak was “ongoing and accelerating.”

People stop to look at the USS Theodore Roosevelt anchored off Stokes Bay in Portsmouth, England, on April 6, 2009. (Matt Cardy/Getty Images)

“We are not at war. Sailors do not need to die,” wrote Crozier in the memo in which he implied that sailors would die unless the crew was taken off and the ship disinfected.

The Navy later announced that they were already taking measures to evacuate the carrier—and that Captain Crozier had been fired.

Acting Secretary Modly said that the letter was sent via non-secure unclassified email outside of the chain of command, “raised alarm bells unnecessarily,” and “created the impression that the navy was not responding to his questions.”

Captain Brett Crozier, commanding officer of the U.S. Navy aircraft carrier USS Theodore Roosevelt, on the ship’s flight deck in the eastern Pacific Ocean on Dec. 19, 2019. (U.S. Navy/Mass Communication Specialist 3rd Class Nicholas Huynh/Handout via Reuters)

The Navy has said that as many as 3,000 will be taken off the ship and quarantined by Friday. As testing continues, the ship will keep enough sailors on board to sustain essential services while it is sanitized in port.

One of the issues raised by the Captain was that the close quarters of the ship make it hard to follow the CDC guidelines on tackling the CCP virus.

“Social distancing is very hard to hard to do on a ship,” says Harrison Schramm, a senior fellow at the Center for Strategic and Budgetary Assessments. “You can’t stay six feet apart in a corridor that is less than six feet wide, for example.”

However, Schramm is confident in the resourcefulness of the crew in tackling the challenges.

The aircraft carrier USS Harry S. Truman (CVN 75) transits the Arabian Sea on Jan. 31, 2020. (2nd Class Scott Swofford/DoD)

“I am absolutely certain that whatever things can be done or can be invented, they are going to do them,” he told the Epoch Times. “Because I know the people involved, I personally have great faith in the Navy both as individual units and corporately to overcome this.”

Although the carrier is no longer in a state of immediate readiness, that would be the case for any ship in port, says Dakota Wood, senior research fellow in defense programs at the Heritage Foundation. “If it needs to deploy in an emergency situation, it would do so and the Navy has the ability to reinforce the crew with additional sailors if needed.”

The Pentagon was happy to sideline the ship precisely because they did not perceive a heightened risk of conflict in the area, says Sidharth Kaushal, Research Fellow in Seapower at the Royal United Services Institute.

“The quarantine of the sailors on the Roosevelt was deemed necessary, but also deemed acceptable, partly because they don’t see any risk of a direct conflagration on the horizon, at least in the short term,” he told the Epoch Times.

The Navy will quickly hospitalize or care for the infected crew and then decontaminate the ship, according to Rick Fisher, senior fellow at the International Assessment and Strategy Center  “It will resume its mission soon.”

The Impact of Further Carrier Outbreaks

“Even if the U.S. had to stop aircraft carrier operations, there are sufficient other U.S. naval, air, and army forces in the Western Pacific to deter potential enemies,” said Fisher.

Richard Bitzinger, Visiting Senior Fellow at the Military Transformations Program at Nanyang University, told the Epoch Times that in the event of more carriers being sidelined, U.S. influence would be clipped.

Sailors stand on the flight deck after launching an F/A-18F Super Hornet from the the Nimitz-class aircraft carrier USS Harry S. Truman (CVN 75) in the North Atlantic, on Sept. 18, 2018. (2nd Class Anthony Flynn/DoD)

“If the U.S. could not send carrier groups to the Indo-Pacific, it would greatly diminish its abilities to project sustainable and robust power,” Bitzinger said via email.

“The U.S. Navy operates largely in terms of “carrier strike groups” (generally one aircraft carrier, supported by 3-4 destroyers, a frigate, and two submarines). Losing these types of power packages greatly undermines the USN’s ability to patrol, make its presence and impact felt, and in general underpin US authority in the region.”

If more U.S. carriers and ships are struck by COVID-19, U.S. influence could be impacted, says Wood.

However, in the event of imminent conflict, ships and sailors would be redirected from other missions and ships already in the region to include those in port, he notes.

“They might be understrength for a period of time and while this would not be preferable, clearly, it would not differ from a ship having to fight with some of its crew wounded.”

“The US military would do things in a wartime situation it would not do in peacetime, ” he said.

Beyond the Roosevelt, the U.S. military has been impacted in other ways by the CCP virus pandemic.

“The need to observe ‘social distancing’ does affect normal education, training, and exercise routines,” said Wood. “This has resulted in events being canceled. Military readiness can be maintained for several months in such situations but after many months, perhaps six or more, individual, unit, and force readiness will begin to degrade.”

The upcoming biannual RIMPAC exercises between the United States and allies in the Pacific—the largest military exercises in the world—could be canceled due to the pandemic, with discussions currently underway, says Kaushal.

Such joint exercises aren’t just geopolitical chest-beating, but a key ingredient of military power, says Kaushal.

“Under a war-time scenario, troops are operating almost on autopilot,” says Kaushal. “That constant drumbeat of exercises is critical, particularly if you are operating with allies that don’t always work with you all year round. [It’s] that readiness that allows things to move like clockwork in wartime.”

Missing one round of exercises wouldn’t degrade effectiveness much, he says. but in the longer term, the effect would be more pronounced.

Impact on China?

It’s not just the United States’ military taking a hit.

“Naval, air, and land forces of the great powers are being impacted across the board by the pandemic,” said Bunker.

“Chinese warships have probably seen outbreaks but the information is likely being classified, as it should be—disclosing that your military capacity is diminished to states you are in geo-political competition with does not make strategic sense.”

But the Chinese regime places a different value on the life of troops, notes Bunker. “They are far more expendable than U.S. military personnel. For instance, a Chinese warship whose crew was infected by COVID-19 would be allowed to continue to operate if it furthered the CCP’s geo-political position—the good of the communist party takes precedence over individual human life. “  

Other analysts agree that little is known of the impact on the Chinese military.

“It most certainly has affected units in Hubei Province, which includes nuclear missile bases,” says Fisher. “But the PLA [People’s Liberation Army] will not be issuing any press releases anytime soon. “

The Chinese military appears to be carrying on as normal with its saber-rattling in the pacific.

During the pandemic, the CCP is continuing to position itself at the expense of allies, says Bunker. “For instance, new research stations are being placed on Kagitingan (Fiery Cross) and Zamora (Subi) Reef.”

“They are also engaging in ongoing information warfare concerning the origins of the pandemic and the amount of COVID-19 fatalities in Hubei province (and across China itself), as well as attempting to sow dissension and panic amongst the American public related to it.”

Wood says it’s too premature to assess whether the outbreak has changed the military dynamics between the United States and adversaries. “While we have some insight into what is happening with the U.S. military, we have very little insight into the military forces of other countries. Thus we cannot yet know whether China, Russia, Iran, or others feel emboldened to act or carry their own worries about whether their forces remain combat-effective.”

Fisher says that the pandemic raises the specter of Chinese bioweapons attacks.

He says that the impact on the USS Theodore Roosevelt can be “considered a “passive” biological attack, aggravated by Chinese Communist Party’s perfidy in concealing the truth about this virus.”

The PLA will be closely monitoring the response of every nation “to assess their willingness and capability to defend against future bioweapon attack,” he says.

“It is well known that China has for decades been developing bioweapons that would have a far more devastating impact on U.S. forces in Asia, or anywhere,” said Fisher. “We must also consider the Chinese Communist Party’s stark history of malevolence against its own people, up to 70 million killed, as proof that the CCP may have no hesitation to use bioweapons against anybody else.”

Bitzinger says he fears that the United States may lose ground to China as it turns to tackle the domestic crisis of COVID-19. “The U.S. is going to be extremely internally focused for several months, and the leadership is not going to be able to think about or deal with Chinese efforts to chip away at U.S. superiority and hegemony in the Western Pacific or Indian Ocean. This distraction with domestic affairs (exacerbated by the upcoming election) will, I fear, leave the U.S. unable to deal with foreign policy.”

Beyond any potential geopolitical shifts, the virus will likely impact U.S. strategic decisions by hitting where it hurts: in the wallet.

“The United States just passed a $2 trillion stimulus package; that’s real money,” says Schramm. “That is obviously going to have some sort of impact on the defense budget, particularly with modernization and procurement.”

“It’s not just the topline that’s going to change,” says Schramm. “There will clearly be an appetite for restructuring the money that’s already on account. For example, things like hospital ships, or that could be rapidly converted into hospital, general purpose logistics ships are going to be more important. My sense is that medicine and construction battalions (“Seabees”) will be more important in the future.”

But, with the pandemic upending so many norms, he is cautious about any concrete predictions. “Anything that I would say about the restructuring right now would be writ in water.”

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Author: Simon Veazey

House Conservatives Urges Trump Not to Rush Fourth CCP Virus Relief Package

House Republican leaders are cautioning President Donald Trump against rushing a fourth CCP virus relief package, warning that the hasty spending could have long-term impact on the country’s debt.

Freedom Caucus Chairman Andy Biggs (R-Ariz.) and Republican Study Committee Chairman Mike Johnson (R-La.) sent a letter to the president on Friday urging him to reject requests for any additional relief packages, arguing that another bill would be premature since the recently passed bill, the CARES Act, has not yet fully taken effect.

“Most of the relief funding from Phase 2 and Phase 3 has not even been distributed yet. We advise caution in considering an additional round of spending outside of the regular process before we have seen the results of the previous three rounds of spending,” the lawmakers wrote. The letter was also signed by 20 other Republican lawmakers.

Congress passed a $2 trillion stimulus package last month that is slated to provide $1,200 for most Americans and $500 for every child, along with a number of measures to support small businesses and companies. Millions of Americans have lost their jobs and businesses have been forced to close as states ordered all nonessential businesses to close to slow the spread of the CCP virus.

House Speaker Nancy Pelosi (D-Calif.) and top Democrats have called for a fourth relief package in response to the pandemic that would include a bipartisan infrastructure deal. The president welcomed the infrastructure proposal in a Twitter post on Tuesday.

But during an interview with CNBC on Friday, Pelosi scaled back on her ambitions on what the next bill would entail, saying that an infrastructure deal that includes things like clean water and more broadband “may have to be for a bill beyond this.” Instead, she said the next bill would expand on the previous one while adding that she would like to see more direct payments to American working families.

In a statement released also on Friday, Pelosi said Congress “must work on an infrastructure package for recovery that addresses some of the critical impacts and vulnerabilities in America that have been laid bare by the coronavirus,” but did not specify whether this would be included in the next bill.

Senate Majority Leader Mitch McConnell (R-Ky.) has also signaled that he supports a fourth relief package, saying that it will focus on healthcare.

“[It] should be more a targeted response to what we got wrong and what we didn’t do enough for—and at the top of the list there would have to be the health care part of it,” he told The Associated Press, confirming there will be another measure.

House Republicans have expressed less enthusiasm about spending more money. House Minority Leader Kevin McCarthy was wary about the idea of a fourth bill when interviewed by Fox News. He said he would like to see how the $2.2 trillion package turns out before making moves on the next one.

In the letter on Friday, the lawmakers expressed confidence that the country would “win the war” against the pandemic but added that the nation may not win its war against the mounting debt.

“Even before the CARES Act was signed into law, the national debt stood at $23.6 trillion, which equates to nearly $73,000 for every citizen—man, woman, and child,” they wrote. “Now we will add at least $2 trillion to this already unsustainable sum. Every dollar we add to the debt today makes it increasingly less likely that we will be able to provide even the basic services our citizens have come to expect in the decades to come.”

“While each of us hold differing opinions about whether the CARES Act was warranted to meet an unprecedented crisis, we are united in the belief that going forward the U.S. simply cannot afford any more deficit spending of this magnitude.”

They said that if further relief packages are necessary, they should only contain measures to “restore and grow the U.S. economy with as little long-term government intervention as possible.”

“Prosperity will return to America, just as it has after every other crisis in our nation’s past. And we fully expect prosperity to return more quickly this time, Mr. President–due in large measure to your leadership. In the meantime, we must ensure that we do not compromise the future of our children and grandchildren or alter the free-market values that have made us the envy of the world,” they added.

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Author: Janita Kan

A Struggle for Wuhan Residents to Survive

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When the Chinese regime pushes people to return to work, it continues boasting about being able to contain the virus. However, people in Wuhan understand the true nature of the regime’s lies while trying to survive during this catastrophe.

The situation in Wuhan is so desperate that one resident said he would rather have the CCP continue lying about there being ‘zero new cases,’ and opening up the city, than keeping it locked up. Wuhan residents have been struggling for months now, unable to make an income, and relying on sparse donations.

This is part 2 of the interview – The Epidemic Reemerges

Reporter: Regardless of the confirmed cases or suspected infections, there are no reports. What do you think of that?

Mr. Gao: We prefer there to be no reports so that the lockdown can be over sooner. The situation is too unbearable. Our main concern is to regain our freedom as soon as possible to be able to survive. So we prefer that they continue to lie by reporting zero new infections. That way they will remove the lockdown sooner. Without the lies, Wuhan will continue to be locked down. We have nothing to eat, and no job, but we’ve got to survive. Between contracting a virus and survival, which one is important? Survival is more important.

Report: But lifting the lockdown will cause wider infections. It’s also unbearable.

Mr. Gao: We either die from the virus or we die from starvation. We’ll starve to death if we are stuck at home. We’ll die from the infection if we go out. Either way, we’ll die. I’d rather die from the virus. I don’t want to starve to death. I have to try to make a living for myself.
We have no government. The regime will not give us money for basic expenditures. We have no extra savings. No cash. There are still utility bills and mortgages to pay. Many people have loans, but no money.
For over two months, there’s no help from the regime, how can you survive? Our monthly earnings could only maintain the minimum needs. For two months, there are no earnings. How can we keep living like this?
Especially to the people in Wuhan, it is said that there are donations from the entire nation, supplied to us. No, we’re not getting anything! Donated fruits? No! Donated veggies? No. Donated oil, rice? No! Zero!
But we have bills to pay. We have no other option but to purchase highly-priced produce, rice, and oil. We have to buy them to feed ourselves. Where’s the money? No money. That means death. There’s no money to buy anything. So, I’d prefer if the regime continues making phony statements of zero cases. The sooner they lift the lockdown, the sooner we’ll be able to make some money on our own. It’s better than starving to death.

Reporter: There was news about many people starving to death at home.

Mr. Gao: Not many, there’s no report of that now. I have seen a couple of cases. Not many of them, but it did happen.
In my community, it was announced that they would go door-to-door to check people’s temperatures every day. People from the community staff came three times so far. They did not check my temperature. The first time they came to book vegetables for us, but we had to pay ourselves. The second time was to deliver rice. But I fell asleep, and it was after 9 p.m. I fell asleep and did not get the rice. It’s been 59 days since the lockdown, and only once did I enjoy eating a fish provided by the regime. The third time they came to ask if I had registered for the health code. That’s about it in my community.

Watch part 1 of the interview here:

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Author: Mary Hong

New York’s Order for 17,000 Ventilators Falls Through as Hospitalizations Continue Rising

An order New York state placed for 17,000 ventilators fell through, Gov. Andrew Cuomo said on Saturday.

“We had paperwork. We had contracts. And then they never appeared,” Cuomo told reporters in Albany.

The governor suggested the order was made from China, where the CCP (Chinese Communist Party) virus, commonly known as novel coronavirus, emerged last year. Documents were signed and the order was placed “but then you get a call that says we can’t fill that order because we had all that demand going in,” he said.

New York officials project a need for up to 40,000 ventilators at the peak of hospitalizations in the state, which is now estimated to happen between four days and two weeks from now. How many ventilators the state has keeps shifting but, based on figures state officials have released in recent days, the number is north of 12,500.

Federal officials have sent 4,400 ventilators to the state, the hardest-hit by the virus in the nation. More ventilators were sent this week, President Donald Trump said Friday. State officials weren’t able to say how many more were sent.

National Guard troops listen as New York Governor Andrew Cuomo speaks to the press at the Jacob K. Javits Convention Center in New York, on March 27, 2020. (Bryan R. Smith/AFP via Getty Images)

The state had some in its stockpile and hospitals were already using the breathing machines during surgery, post-surgery, and in other cases. Chinese executives are sending a donation of 1,000 ventilators facilitated by the CCP and Oregon is sending 140 more.

Another 500 will come from hospitals not currently using ventilators, Cuomo said. He signed an executive order this week allowing the state to seize ventilators and redistribute them. Officials asked hospital executives how many unused ventilators they had and are taking 20 percent of that number.

Officials were scheduled to speak to hospitals in a conference call later Saturday to coordinate equipment deployment.

Cuomo warned on Thursday that the state was six days away from running out of ventilators but Trump told reporters in Washington that federal officials believe New York “is well served” with the breathing machines.

“We’re going to find out, but we have other states to take care of. We have a big problem in Louisiana, we have a big problem in Michigan, we have a big problem in seven other really strong hotspots, but we’re doing the best we can,” he said.

A man is brought into Elmhurst Hospital in the Queens neighborhood, which has one of the highest infection rates of the CCP virus in the nation, in New York City on April 3, 2020. (Spencer Platt/Getty Images)

Deaths Rise, Hospitalizations Down

The number of daily deaths from the new virus increased slightly to 630, a new record-high, while the hospitalizations dropped to 1,085 from 1,427 the day prior. Another 395 patients entered intensive care units, bringing the total in ICUs to 4,126.

“We’re not yet at the apex. We’re getting closer,” Cuomo said.

Models indicate the peak of cases will arrive between 4 and 14 days, but state officials believe it will come around seven days from now.

“No one can give you a very specific number, which makes it frustrating to plan,” Cuomo said. “It’s good that we’re not at the apex because we’re not yet ready for the apex either. The more time we have to improve the capacity of the system, the better.”

Overnight, 1,592 patients were discharged from hospitals. Nearly 10,500 patients have now been discharged from hospitals.

An area of growing concern is Long Island, which now makes up 22 percent of all those hospitalized in the state, as the number of hospitalizations slow in New York City.

“Watch Long Island. It is like a fire spreading. It consumes where it is and then it’s moving out,” Cuomo said.

The number of cases in Long Island has been growing for 10 days. The island is situated just east of New York City and includes Nassau and Suffolk counties.

New York reached 113,704 COVID-19 cases in the latest numbers, including 63,306 in New York City. The state has tested over 283,000 people.

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Author: Zachary Stieber

Alabama and Missouri Issue Stay-at-Home Orders, 9 States Yet to Announce

Nine American states have yet to declare mandatory stay-at-home orders after the governors of Alabama and Missouri on Friday told residents to avoid going outside except for “essential activities.”

Alabama governor Kay Ivey on April 3 issued a statewide shelter in place order, effective Saturday, April 4, and set to expire on April 30, according to a release.

“My fellow Alabamians, I plead with you to do your part to #StopTheSpread of #COVID19. We’ve got to take this order dead serious; otherwise, the fact is more people will end up dying,” Ivey said in a tweet.

Alabama Governor Kay Ivey announces a statewide stay-at-home order on April 3, 2020. (Office of the Governor)

As of Friday afternoon, Alabama had 1,432 reported COVID-19 infections and 34 deaths, according to

“Folks, April stands to be very tough, and potentially very deadly,” Ivey said at a press conference, the outlet reported. “You need to understand we are past urging people to stay at home. It is now the law,” she added.

The restrictions in Alabama include “essential retailers” allowing no more than 50 percent occupancy and preventing customers from standing closer than 6 feet apart.

A shopper passes a self-distancing queue outside Trader Joe’s, as they limited the amount of shoppers allowed in the store to help prevent the spread the CCP virus, in Bailey’s Crossroads, Virginia, on March 31, 2020. (Kevin Lamarque/File Photo/Reuters)

Missouri Gov. Mike Parson on April 3 issued a similar stay-at-home order, effective April 6 to April 24, according to a release.

“There comes a time when we have to make major sacrifices in our lives. Many of us make sacrifices each and every day, but now more than ever, we must all make sacrifices,” Parson said. “This is not about any one individual person. This is about our families, friends, neighbors, and the entire state of Missouri. For the sake of all Missourians, be smart, be responsible, and stay home, Missourians.”

As of Friday, Missouri had 2,113 positive CCP virus cases out of 24,727 tested in a total population of 6 million Missourians, officials said. According to these figures, around 8.5 percent of people tested in the state were infected with the Chinese Communist Party (CCP) virus, commonly known as the novel coronavirus.

The Missouri order explicitly states that people residing in the state of Missouri must avoid leaving their homes or places of residence unless necessary.

Among other guidelines, the Missouri order forbids social gatherings of 10 or more people and essential businesses are restricted to 25 percent occupancy.

An employee at a cafe and bakery wears a mask in Los Angeles, Calif., on March 17, 2020. (Frederic J. Brown/AFP via Getty Images)

“The order does not prohibit Missourians from accessing essential services, such as grocery stores, gas stations, and banks, or engaging in outdoor recreation, provided that necessary precautions are taken and maintained to reduce the transmission of COVID-19,” the press release said.

White House task force projections predict that between 100,000 and 240,000 Americans could lose their lives due to the virus.

Dr. Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases, and a member of the virus task force, has urged states to adopt stay-at-home orders to curb the spread of the disease.

Most states have, with the nine holdouts being Arkansas, Iowa, Nebraska, North Dakota, Oklahoma, South Carolina, South Dakota, Utah, and Wyoming.

Meanwhile, the United States recorded the highest-ever daily death toll from the CCP virus outside China, at 1,321 fatalities between April 2 and April 3, according to statistics site Worldometers.

The figure excludes China due to persistent doubts about the reliability of state-reported figures.

According to the tracker, 6,071 people in America lost their lives due to the disease as of Thursday, while on Friday that count increased to 7,392.

Looking ahead, experts see aggressive testing and contact tracing as key to handling subsequent waves of the virus.

Kenneth Castro, a professor of global health, epidemiology, and infectious diseases at Emory University, said local, state, and federal governments should start recruiting an “army” of people to handle contact investigations.

“Identify and contain is better than having society shutdown. It’s a balancing act,” said Castro, who oversaw the Centers for Disease Control and Prevention’s tuberculosis effort for two decades through 2013. “We won’t be able to maintain physical distancing forever.”

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Author: Tom Ozimek

What’s Being Done Around Canada to Fight the CCP Virus

The COVID-19 pandemic has affected every province and territory. Medical officers of health and Canada’s chief public health officer are encouraging people to wash their hands, give each other space, and wear a mask if they’re sick.

Ottawa has put money into health care research and the economy. It has also put restrictions on international travel and is enforcing 14-day quarantines for travellers returning to Canada to try to limit spread of the CCP virus.

Classes are suspended or cancelled at schools throughout the country.

Each province and territory also has its own emergency measures to detect cases and prevent spread of the virus.

Here’s a look at some of the ways different jurisdictions are responding:

British Columbia

B.C. declared a provincial state of emergency on March 18, a day after announcing a public health emergency.

The measure gives the province authority to take any action necessary to protect people and communities, including charging people who ignore public health orders.

The province has also prohibited reselling essential supplies such as food and cleaning material.

All parking fees at B.C. hospitals starting April 1 will be cancelled to ensure safer access for patients and staff.

Officials have prohibited gatherings of more than 50 people in one place, including restaurants, schools, places of worship, theatres, casinos, sports arenas, and outdoor venues.

Some provincial parks are closed.

Officials have also issued fire restrictions as the wildfire season begins.

Premier John Horgan says he is extending the state of emergency through the end of April 14.


Alberta declared a public health emergency on March 17.

The province has given law enforcement agencies full authority to enforce orders and issue fines for violations.

There are restrictions on mass gatherings of more than 15 people, both indoors and outdoors at places of worship, weddings or funerals. Any gathering must allow people to keep the two-metre distance from others.

All non-essential businesses have been ordered closed, including personal service providers, clothing stores, and furniture stores.

Albertans are prohibited from attending public or private recreational and entertainment facilities. Restaurants have been ordered closed, except for takeout or delivery. Casinos are closed.

Vehicle access to provincial parks and public lands is also prohibited to visitors.

Albertans who have been ordered to quarantine cannot leave their property for 14 days. That also bars people who live in apartments to use the elevators.


Premier Scott Moe declared a provincial state of emergency on March 18.

It directs all orders from the chief medical health officer be followed and gives police the authority to enforce them.

Public gatherings are limited to no more than 10 people.

Nightclubs, bars, and lounges are closed, but they are allowed to provide takeout food or alcohol.

Recreational and entertainment facilities are closed. Personal service providers such as tattooists, hairdressers, estheticians, and relaxation masseuses cannot operate.

Dental, optometrist, chiropractic, and podiatry clinics are closed—except for emergencies.


The Manitoba government declared a provincewide state of emergency on March 20.

The province has limited public gatherings to no more than 10 people, down from an earlier limit of 50.

It includes any indoor or outdoor spot, places of worship or family events such as weddings and funerals.

Non-essential businesses have been ordered to close. Salons, spas, bars, and other establishments will be closed starting Wednesday. Restaurants can remain open for takeout or delivery only.

The closures do not affect health care facilities, government services, and other institutions.

Bingo and gaming venues as well as wellness centres and gyms are closed.

The province is also letting people hurt by the COVID-19 economic fallout avoid penalties and interest on some utility payments and property taxes.


Ontario declared a state of emergency on March 24.

All business except those deemed essential have been shut down.

All industrial construction except for essential projects, such as hospitals, has been halted.

All bars and restaurants, except for takeout and delivery, have been closed.

Also closed are recreational facilities, public libraries, private schools, licensed childcare centres, movie theatres, and concert venues.

Any public events of more than 50 people, including parades, events, and services at places of worship, are prohibited.

Provincial parks are closed.

The City of Toronto has also shut down playgrounds, sports fields, off-leash dog parks, skateboard parks, and picnic areas. Parking lots attached to parks are closed.


Quebec declared a public health emergency on March 13 and renewed it a week later.

The government has reduced non-priority services and prohibited indoor and outdoor gatherings.

Quebec has also prohibited non-essential visits to hospitals, residential and longterm care centres, or between children in foster families and their biological families.

Designated clinics have been opened for anyone displaying symptoms.

To give retail employees a break, stores will be closing on Sundays in April, with only pharmacies, gas stations, convenience stores, and takeout restaurants remaining open on those days.

Montreal’s mayor has also declared a state of emergency to help authorities better manage the spread of COVID-19 among the city’s homeless.

New Brunswick

A state of emergency was declared in New Brunswick on March 19.

Businesses serving food and beverages have been restricted to takeout and delivery. Lounges and clubs are forbidden from allowing customers to enter.

Customers are not allowed to enter retail businesses, unless they serve food, medication, fuel, or other essential supplies.

Many health services—such as chiropractors, dentists, and optometrists—are prohibited from seeing patients in person unless absolutely necessary.

No gatherings larger than 10 people are allowed and residents are urged to stay home as much as possible.

Any unnecessary travel into New Brunswick is prohibited.

Nova Scotia

The province of Nova Scotia declared a state of emergency on March 22.

It set out specific rules for self-isolation and self-quarantine for people returning from outside Canada.

All schools and daycares are closed. Longterm care facilities and residential care facilities are closed to visitors.

Casinos have closed and no business is allowed to operate a video lottery terminal.

Restaurants are restricted to takeout and delivery service only. Drinking establishments are closed.

There are also restrictions on health professionals such as chiropractors and dentists.

Prince Edward Island

Premier Dennis King declared a public health emergency on March 16.

It included an order to Islanders to refrain from attending any public gatherings and a closure of libraries, childcare facilities, gyms, and schools.

Measures announced a week later included fines for anyone who doesn’t comply with a direction to self-isolate.

The public health officer recommends people who are self-isolating stay on their own property when outside.

The government is working to open an outpatient clinic to allow for increased testing and to ease the load on hospitals.

Newfoundland and Labrador

The province declared a public health emergency on March 18.

It includes the closure of most businesses—with the exception of grocery stores, pharmacies, gas stations, and other stores considered essential.

Gatherings of more than 10 people are not allowed. That includes funerals and weddings.

Anyone arriving from outside the province is required to self-isolate for 14 days.

Health officials have the authority to restrict the rights and freedoms of people in a time of crisis. People who violate orders face fines.


Yukon declared a state of emergency on March 27.

Yukon residents flying into Canada with COVID-19 symptoms must quarantine at their arrival destination, and those without symptoms are ordered to self-isolate for 14 days when they get home.

Yukon has asked everyone arriving in the territory, including mine workers, to self-isolate for 14 days.

The government has closed bars and limited social gatherings to 10 people or less.

Recreation facilities, libraries, museums, and visitor centres are closed. School classes are suspended until at least April 15.

Longterm care facilities are closed to visitors and volunteers, while all non-urgent or routine services, including lab tests, X-rays, physiotherapy, and occupational therapy are suspended.

All dentists must also suspend non-urgent treatment until further notice.

Northwest Territories

The Northwest Territories declared a public health emergency on March 18, which has now been upgraded to a state of emergency.

It requires anyone who arrives in the territory from outside its boundary to self-isolate for 14 days.

Travel through all points of entry into the territory—both air and road—is prohibited.

The orders exclude essential service workers such as medical professionals or emergency services.

The territory has asked that all indoor and outdoor gatherings be cancelled—regardless of size or number.

Many businesses, including tour operators, gyms, museums, and theatres, have been ordered to close.

The government said it will help Indigenous families who want to head out on the land as an alternative to physical distancing. It will administer a $2.6-million grant to help families buy the proper gear and supplies to head out to fishing and hunting camps.


Nunavut declared a public health emergency on March 20.

It has no known cases of COVID-19, but it has restrictions in place.

There is a mandatory 14-day self-isolation period at one of four locations in southern Canada for any resident that wants to return to Nunavut.

Critical employees who need to return to work must apply for an exemption.

All non-essential medical travel has been cancelled.

Public gatherings, including at playgrounds or parks and at religious, cultural, or spiritual services is prohibited.

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Author: The Canadian Press

A Chinese student posted a video calling on CCP to step down

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Zhang Wenbin, a university student in the eastern Chinese province of Shandong who posted a video to social media calling on President Xi Jinping to step down, has been incommunicado since the video was posted to Twitter on March 30, 2020.

In the post he wrote, will this world be okay? I hope I can use blood to awaken people’s conscience. My name is Zhang Wenbin, a Chinese university student.

Several days ago, Wenbin’s WeChat account was permanently terminated after he posted on his WeChat account, Xi Jingping steps down, Chinese Communist Party steps down. In the morning of March 30 , he posted it on Twitter saying he had been summoned by police and detained for five days because of his WeChat post, and his most recent Twitter post in the video asking the CCP to step down.

Zhang Wenbin: I was once a “little pink” supporter of the ruling Chinese Communist Party.
Since I scaled the Great Firewall, I gradually came to the realization that the Chinese Communist Party has extended its dragon claws into every corner of the world, including collective farming [1950s], the Cultural Revolution [1966-1976], the Great Famine [1958-1961], the One-Child Policy, the Tiananmen massacre [1989], as well as the persecution of the Falun Gong [spiritual movement], and the peoples of Tibet, Hong Kong and Xinjiang.
And yet everyone continues to turn a blind eye, singing the party’s praises. I just can’t bear it.

When I look at the courage with which Hong Kong and Taiwan stand up to the Communist Party, I want my own voice to be heard.

I call on you all to look upon the true colors of the Communist Party, and stand together to bring down this wall.
Xi Jinping, you can leave now. So can the Communist Party!

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Author: Epoch Video

Search Suspended for 2 Members of Kennedy Family Lost in Chesapeake Bay

The search for two members of the Kennedy family—Maeve Kennedy McKean and her son, Gideon—was suspended 26 hours after they were reported missing in the Chesapeake Bay near Annapolis, Maryland, the Coast Guard said Friday night.

Authorities confirmed McKean and her 8-year-old son were the missing individuals. They were last seen on Thursday evening.

“This was a difficult case, and even more difficult to make the decision to suspend the search,” said Cmdr. Matthew Fine, deputy sector commander and active search suspension authority at Sector Maryland-National Capitol Region command center, late Friday night. “Our crews and partners did everything they could to find them. We’ve kept the family informed at every step during the search, and our thoughts are with them tonight.”

This undated image posted on Maeve Kennedy Townsend McKean’s Facebook account shows her with her family, including her son Gideon Joseph Kennedy McKean, bottom right. (Twitter via AP)

Former Maryland Lt. Gov. Kathleen Kennedy Townsend, McKean’s mother, said earlier in the evening that the search had turned from a rescue to a recovery mission.

“With profound sadness, I share the news that the search for my beloved daughter Maeve and grandson Gideon has turned from rescue to recovery,” Townsend said in a statement.

This undated image posted on Maeve Kennedy Townsend McKean’s Twitter account shows her son Gideon Joseph Kennedy McKean. (Twitter via AP)

“My heart is crushed, yet we shall try to summon the grace of God and what strength we have to honor the hope, energy and passion that Maeve and Gideon set forth into the world,” the statement read. “My family thanks all for the outpouring of love and prayers as we grieve and try to bear this devastating loss.”

McKean is the granddaughter of former U.S. Attorney General and U.S. Sen. Robert F. Kennedy. She is a public health and human rights lawyer and serves as the executive director of the Georgetown University Global Health Initiative.

McKean’s husband, David McKean, wrote in a Facebook post Friday that “it is clear that Maeve and Gideon have passed away. The search for their recovery will continue, and I hope that that will be successful.”

“At this time, our family asks for privacy and that everyone keep Maeve and Gideon in their prayers,” the Kennedy family said in a statement provided by a spokesperson earlier Friday.

David McKean remembered his wife and son in his Friday post.

“It is impossible to sum up Gideon here. I am heartbroken to even have to try. I used to marvel at him as a toddler and worry that he was too perfect to exist in this world. It seems to me now that he was,” he wrote in part. And of his wife he said: “She was my everything. She was my best friend and my soulmate.”

The family was self-quarantining at Townsend’s home on the Chesapeake Bay, when Gideon and Maeve were playing kickball and one of them kicked the ball into the water, according to David McKean. “They got into a canoe, intending simply to retrieve the ball, and somehow got pushed by wind or tide into the open bay,” he wrote.

Rep. Joe Kennedy III of Massachusetts, also a grandchild of Robert F. Kennedy, memorialized the two on Twitter, saying: “We love you Maeve. We love you Gideon. Our family has lost two of the brightest lights. Grateful for the prayers. Hold your loved ones tight.”

Coast Guard officials had received a report of “two individuals … seen struggling to return to shore in a canoe” near Herring Bay, 10 miles south of Annapolis, and were “not seen again,” according to a statement Friday from the Coast Guard.

Capt. Erik Kornmeyer of the Anne Arundel Fire Department told CNN that a call from a “concerned citizen” came in at 4:30 p.m. ET Thursday.

Queen Anne Police Department, Arundel Police Department, Maryland Natural Resource Police, and Maryland State Police have been assisting in the search, the Coast Guard said in a statement Friday.

Maryland Gov. Larry Hogan said Friday that “an intensive search has been underway since yesterday” for Maeve and Gideon.

During a news conference, Hogan said he spoke with McKean’s mother Friday morning.

“On behalf of the people of Maryland, I expressed our most heartfelt sympathies and prayers to her and to her entire family during this difficult time,” Hogan said.

McKean also advised the Obama administration for the State Department’s global AIDS program and has volunteered in Mozambique for the Peace Corps, established by her great uncle, former President John F. Kennedy. Last year, McKean, along with Townsend and former U.S. Rep. Joseph P. Kennedy II, wrote an op-ed for Politico in which they denounced the anti-vaccine views of Robert F. Kennedy Jr., calling them “tragically wrong.”

The McKeans also have a 7-year-old daughter Gabriella and a 2-year-old son Toby.

Over the decades, the Kennedy family has endured high-profile tragedies. Both McKean’s grandfather and great uncle were assassinated. McKean’s cousin, John F. Kennedy Jr., and his wife, Carolyn, were killed in a plane crash two decades ago.

This story has been updated with comment from David McKean and Massachusetts Rep. Joe Kennedy III.

™ & © 2020 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

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Author: Wire Service

Paddleboarder Arrested for Using Ocean During COVID-19 Pandemic

A paddleboarder in California was chased down on the Pacific Ocean by sheriff’s deputies for violating Gov. Gavin Newsom’s stay at home order.

Lifeguards flagged down Los Angeles County Sheriff Department deputies on Thursday, telling them that an adult male was in the water and not listening to orders to stop paddling.

The suspect was in the water paddle boarding for 30 to 40 minutes before sheriff deputies brought in a boat from Marine Del Rey Station.

“Once the Sheriff’s boat arrived on scene, the suspect complied and swam to shore,” the Lost Hills Sheriff’s Station said in a statement.

An Instagram video filmed from the shore showed the man paddling away from the boat before he was caught by a lifeguard boat. A photograph showed the man in handcuffs, escorted by two sheriff’s deputies.

The male was transported to the local sheriff’s station, where he was booked and released on a promise to appear in court, deputies said.

Transmission electron micrograph of the CCP virus, commonly known as novel coronavirus or SARS-CoV-2, isolated from a patient. Photo published March 10, 2020. (NIAID)

He was arrested for disobeying a lifeguard and violating the governor’s order. The paddleboarder now faces up to six months in jail and a fine of up to $1,000.

Newsom last month ordered residents to stay at home except for essential trips such as going to the grocery store or a pharmacy.

A page on the state government website says that Californians can still exercise as long as they maintain a distance of six feet from people who aren’t part of their household.

“It is ok to go outside for exercise, a walk or fresh air,” it stated.

Many state beaches have been closed to try to prevent the spread of the CCP (Chinese Communist Party) virus, commonly known as novel coronavirus. Lifeguards and law enforcement are working together to block people from the beaches, crack down on violators, or, in areas where beaches are still open, remind them of social distancing measures.

An aerial drone view of Dillon Beach, which is closed because of the CCP virus, in California on April 1, 2020. (Ezra Shaw/Getty Images)

A surfer in Manhattan Beach last month received a $1,000 fine for refusing to leave.

“Everyone has been very cooperative, it was just that one guy,” Manhattan Beach police Sgt. Mike Sistoni told the Orange County Register. “Everyone else has been pretty cool… I don’t know if he was having a bad day or what.”

Lifeguards contacted law enforcement when the man declined to obey orders to leave the beach, Sistoni said.

Video footage captured from the shore showed surfers being forced to leave the ocean except for the man who was ticketed.

California State Parks announced in recent days the closure of a number of state parks, including many in Los Angeles County. The system said last weekend it was cutting off vehicular access to all of the 280 parks in the state.

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Author: Zachary Stieber