New Jersey-Tingo Group’s shares plunged over 50% after Hindenburg Research called it an “obvious scam” with alleged falsified financials. The report highlights major inconsistencies and red flags in the company’s operations including the CEO’s background, unverified business claims and financial discrepancies.
Tingo Group has diversified business interests in mobile phones, food processing, and online food marketplace mainly in Nigeria. It operated in Africa, Southeast Asia and the Middle East. The US-based short seller made serious allegations about the company and its founder, Dozy Mmobuosi.
Mmobuosi is regularly portrayed by the media as a billionaire. He made headlines earlier this year when he attempted to buy the now-Premier League soccer team Sheffield United. He has been accused of fabricating his achievements and past.
Hindenburg claimed that Mmobuosi fabricated his claim to have developed Nigeria’s first mobile payment app. "We contacted the app's actual creator, who called Dozy's claims 'a pure lie,” Hindenburg said in its report.
According to the report, the company claimed its mobile handset leasing, call and data business generated $128 million in revenue last year, saying these services are provided through an agreement with Airtel in Nigeria. The license type they claim did not exist until June 2023, Hindenburg said.
The company’s shares slumped more than 55% to $1.13 in early trading on Tuesday.
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.
The report could potentially lead to regulatory scrutiny and legal challenges, with a severe impact on Tingo’s operational future and stock performance.
Tingo is the US-based short-sellers fourth target this year after Adani Group, Jack Dorsey’s Block Inc and Carl Icahn’s flagship firm Icahn Enterprises.
