by ZH
Here is the latest candidate for very careful diligence: China Integrated Energy (NASDAQ:CBEH). From the Sinclair Upton Research thesis: “In this report, we present irrefutable evidence that China Integrated Energy (NASDAQ: CBEH) is 1) transferring company funds to management insiders through fraudulent sham acquisitions and 2) fabricating its SEC financial statements. CBEH has transferred at least $35 million dollars of company cash by making acquisitions of shell companies owned by Gao Bo, who is the firstborn son of the CBEH’s CEO, Gao Xincheng. Given that the company has made over $134 million dollars in acquisitions and lease “prepayments”, our research has uncovered only a small fraction of the total amount being stolen from shareholders. There is also strong evidence that the financial results of all three segments of the company, refined products distribution, biodiesel, and gas stations, are overstated or even fictitious. The true value of CBEH is likely to be no more than $0.76/share, equal to the $37 million raised in recent secondary offerings, if the cash has not already been funneled out to related parties under the guise of even more acquisitions, gas station leases, and capital expenditures.”
To the longs who jumped in like all good momos without doing due diligence: good luck. We urge you to read the below report.
