Shares Of A Chinese Company Plunged After Famed Short-Seller Carson Block Mentioned It At A Private Conference
You could definitely see some action in 500.com's stock right before the close around the time Block was scheduled to speak. The stock fell 4% and the trading volume spiked.
Block, who runs Muddy Waters Research, named the company yesterday afternoon at the Value Investing Congress in New York City. This year's VIC is closed to press.
According to a source who was at the conference, there were about 2 slides in Block's whole presentation that mentioned 500.com. The source told us that Block identified some "red flags," but nothing confirmed in terms of fraud.
Block told conference attendees there's no official report coming from Muddy Waters, so it's not like one of their deep-dive research projects.
Block is famous for targeting Chinese companies he believes are frauds. He's probably best known for his takedown of Sino-Forest that ultimately caused hedge fund billionaire John Paulson to lose millions and eventually sell out of the stock. Sino-Forest, which Block said was overstating its timber holdings, eventually ended up filing for bankruptcy.
Now check out 500.com's action from yesterday:
