Hindenburg: Founder of short seller behind Adani stock report resigns

BANGKOK (AP) — Nate Anderson, the founder of the financial information company muckraking Search Hindenburgsaid he was disbanding the organization after completing the work it had set out to do.

Hindenburg, founded in 2017, has a history of driving down its targets’ stock prices by revealing fraud and other abuses that it uncovered through extensive forensic financial research. He had a financial incentive to do so, using a trading technique called short selling to make money if his reports caused the stock and bond prices of the targeted companies to fall.

In one of his dozens of projects, he focused on the Indian conglomerate Adani Groupaccusing him of “brazen securities manipulation and accounting fraud.” Hindenburg cited two years of research, including interviews with former senior Adani executives and review of thousands of documents. Adani disputed the allegations, which sent share prices of its group companies tumbling.

In another case, Hindenburg Research questioned electric truck maker Lordstown Motors’ reported number of pre-orders for its Endurance model, leading to a management shakeup. The automaker was in difficulty and sold a massive automobile assembly plant in Ohio to Taiwanese iPhone maker Foxconn to ease its financial woes.

Anderson said in a letter posted to

He said there was no specific reason for choosing to stop, although the intensity and focus of the work had come at the cost of missing people and experiences. The next step will be to provide open source information on how Hindenburg conducted its investigations, he said.

“To my family and friends, I’m sorry for the times I ignored you while I let my attention wander. I look forward to having more time to share with you together,” he said.

Anderson said he would work to ensure his team members “land where they want to be next.” Some are considering starting their own research company, in which he will not participate. Others will be “free agents”.

He said nearly 100 people had faced criminal or civil charges from regulators, at least in part because of Hindenburg’s work, which focused on accounting irregularities, illegal or contrary business or financial practices. ethics and other undisclosed regulatory, product or financial issues.

One of his most famous reports was a 2020 expose on Nikola, an electric vehicle company whose founder Hindenburg said made misleading statements about signing partnerships with major automakers eager to catch up. Tesla.

Among his allegations, Hindenburg accused Nikola of staging a video to quell skepticism about his truck, a video showing the vehicle driving down a road. Hindenburg said the video actually just showed the truck rolling down a hill after being towed to the top.

End of 2021, Nikola agreed to pay $125 million to settle charges by the Securities and Exchange Commission that it defrauded investors by misleading them about its products, technical advances and business prospects.

Anderson praised his team of 11 who he said are smart, focused and “very kind and polite” but at the same time are “ruthless assassins, capable of doing world-class work.”

The company says it views the Hindenburg, the airship that burst into flames in the 1930s amid cries of “Oh, mankind,” as “the embodiment of a completely man-made and completely avoidable disaster.” He says he looks for similar disasters in financial markets “before they attract unsuspecting victims.”

“Over time, people began to understand what I hoped I could show: that it is possible to make an impact no matter who you are,” Anderson wrote.