Dozy Mmobuosi, the founder of Tingo Group, a conglomerate, has been accused of orchestrating a large-scale scam with allegations of forged financial statements.
The celebrated tech billionaire now faces scrutiny and uncertainty.
The stocks of his firm, Tingo, the Nigerian-based agri-tech firm, fell by as much as 80.27%, closing at $0.07 on Tuesday, June 6, 2023, after Hindenburg Research released a report alleging fraud in the company.
According to reports, Hindenburg Research said it was shorting Tingo Group because it believes the company is a scam with forged financial records.
However, an executive of Tingo has denied the allegation in the Hindenburg Research Report, describing them as false accusations.
Report Accuses Tingo Boss Of Forgery
Per the Hindenburg report, Tingo ignored red flags, including Mmobuosi’s claims to have developed the first mobile app in Nigeria.
The report also accused Mmobuosi of claiming to have received a Ph.D. in rural advancement from a Malaysian university in 2007. Hindenburg said the school denied knowing anybody by that name after it was contacted.
Furthermore, Hindenburg’s report cited serious doubts regarding Tingo’s financials and business operations. Tingo Foods, the company’s food unit, claimed to generate massive revenues, despite having no food processing facility of its own.
The report states that a proposed food processing unit turned out to be a stock image of an oil refinery while the site had zero signs of progress except for the plaque and billboard.
“We think Tingo is a worthless and brazen fraud that should serve as a humiliating embarrassment for all involved,” Hindenburg stated in its report.
Tingo Group Denies Allegations
Tingo Group has described as misleading and libellous report by Hindenburg Research against it’s founder and CEO Dozy Mmobuosi and his group of companies.
The firm in a statement condemned all the allegations and misinformation outlined in the report published earlier by Hindenburg Research, adding that it remains in compliance with the laws of the territories in which it operates and maintains the highest standards of corporate governance.
According to Tingo Group “The report, which contains numerous errors of fact, together with misleading and libellous content, appears to be a deliberate attempt to undermine the positive work that Tingo Group is undertaking across various worldwide markets. As disclosed by Hindenburg Research, the report represents their own opinion, and is designed to benefit a short position taken by them and their associates from which they stand to realize sizeable gains. The Company can confirm that no attempt was made by Hindenberg Research to verify the allegations or otherwise make genuine inquiries concerning the information provided in the report prior to its release”.
The Company also said that its accounting records are accurate and correct and that its financial results are accurately reported within its financial statements and its SEC filings.
“The investor community has demonstrated its faith in Tingo Group on the basis of detailed analyses and reports prepared by leading professional advisors, financial experts, and credit rating agencies. Tingo Group will respond in detail to the allegations made by Hindenburg Research in due course, but for the avoidance of doubt, the Company believes the report published today is a deliberate attempt to damage its reputation maliciously and unlawfully through the issuance of false, misinformed and distorted information for Hindenburg Research’s own financial gain and at the expense of the Company’s shareholders” it said.
Legal Fireworks Looming
Block & Leviton, a Boston-based law firm known for fighting corporations on behalf of investors, said it was investigating Tingo Group for potential law breaches.
Following the Hindenburg Researc report, Block & Leviton, a Boston-based law firm with a reputation for fighting corporations on behalf of investors, said it was investigating Tingo Group for potential securities law violations.
As the accusation swirled worldwide, there were questions about the nature and future of Tingo Group and its success and level of Mmobuosi’s alleged involvement in sharp practices.