Shares of Singularity Future Technology Ltd (NASDAQ:SGLY) are down nearly 30% today after the company was the subject of a new short report from Hindenburg Research.
The key focus of the report is Singularity’s CEO, Yang Jie, who allegedly ran a $300 million Ponzi scheme that lured in over 20,000 victims.
According to Chinese media and Hindenburg, authorities in China are still looking for Jie. Since he took over last year, Singularity made a shift toward digital assets. What followed is a $200 million order to produce crypto mining equipment.
“Singularity apparently expects investors to believe that it engineered, designed, tested, began to mass-produce, and sold hundreds of millions worth of crypto miners all within 3 months of its announced business pivot,” the report noted.
Accordingly, Yang Jie’s wife has served as VP of the SOS subsidiary that made the $200 million order.
Moreover, the company just recently announced an up to $250 million partnership with the U.S. power producer called Golden Mainland, sending shares to an all-time high. Since then, the Singularity stock price is down 75%.
The short-seller said it found that SOS Limited “seems to have fabricated key aspects of its own pivot to cryptocurrency. The company’s stock has fallen 90% since our research was released, and SOS recently disclosed an SEC investigation relating to our report.”
“Golden Mainland’s website was registered just 1 day before the Singularity press release, and the entity was incorporated just 6 months earlier. We found no indication that the prospective partner owned any energy assets, much less 10 GW+ worth. We also found no evidence that Golden Mainland has a headquarters or any employees aside from its founder, who used a Gmail address on the SEC filing detailing the supposed $250 million deal. We believe Golden Mainland is a blatant fabrication.”
Net-net, Hindenburg’s research showed that Singularity “is an extremely obvious total scam, with little to no actual business operations.”
By Senad Karaahmetovic