Shares of China Integrated Energy Inc. (Nasdaq: CBEH) lost more than a third of their value in the wake of a research report alleging that the company was fabricating revenue and earnings, and that it had transferred tens of millions in cash to the son of its chief executive through questionable acquisitions.
The 44-page report and a shorter follow-up were posted by someone who used the alias Sinclair Upton and claimed to be an investment manager.
China Integrated Energy has yet to respond to the allegations. It filed its audited annual report with the Securities and Exchange Commission on Wednesday.
Sharesleuth previously raised questions about China Integrated Energy in 2008, when it was known as China Bio Energy Group Holding Co. It was one of four Chinese companies that went public through reverse mergers with shells controlled by a group that included Martin A. Sumichrast, a former brokerage executive whose publicly traded firm, Global Capital Securities Corp., was delisted by Nasdaq because of its ties to people with serious criminal or regulator histories.