Hindenburg's latest target after Adani, Jack Dorsey, Carl Icahn is a Nigerian entrepreneur: All you need to know

Hindenburg Research, that published a scathing report on the Gautam Adani-led Adani Group earlier this year, has gone after another company now. After its report on Adani, the short-seller had targeted Jack Dorsey-led Block and Carl Icahn's flagship Icahn Enterprises. The latest in the list of Hindenburg is Tingo Group, whose shares halved in value on Tuesday.

The short-seller called out the Nigerian company’s founder and alleged that the fintech firm fabricated its financials. It questioned Tingo’s founder Dozy Mmobuosi’s claim of having developed the first mobile payment app in the country. Hindenburg said that Tingo was an ‘exceptionally obvious scam’.

“We’ve identified major red flags with Dozy’s background. For starters, he appears to have fabricated his biographical claim to have developed the first mobile payment app in Nigeria. We contacted the app’s actual creator, who called Dozy’s claims “a pure lie”,” the short-seller said in its report.

Hindenburg said that they contacted the Malaysian university from where Dozy claimed to have received his PhD in rural advancement in 2007 but the university wrote back saying their verification system had no one by his name.

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It added that Tingo’s financials are riddled with errors and typos. In one such statement there was a note to itself that the company apparently forgot to delete. It read: “Please update for the tingle transaction including the tingle foods transaction (sic)”. Tingo’s financials had basic mathematical errors including leaving zeroes off key metrics.

The company’s cash flow and balance sheet statements do not reconcile, Hindenburg stated, adding further that it shows “major errors indicating a complete lack of financial controls”.

“The errors also seem to apply to Tingo’s audited annual financial statements, which were recently given an unqualified audit opinion by Deloitte Israel,” said Hindenburg, further pointing out that Tingo lacks substantive operations in Israel.

The short-seller said that it believes that the cash balance Tingo claims to hold in Nigeria is fake. “Overall, we think Tingo is a worthless and brazen fraud that should serve as a humiliating embarrassment for all involved. We do not expect the company will be long for this world,” it said.

In its response, Tingo categorically refuted all the allegations of the report and called them “misleading and libelous”. "The Company also confirms that its accounting records are accurate and correct and that its financial results are accurately reported," the company said.

The New Jersey-based holding company, whose shares shed more than 53% to $1.20, operates in Africa, Southeast Asia and the Middle East. Its units have ventured into agri-fintech, food processing and insurance brokerage.

(With Reuters inputs)

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