NQ Mobile Inc. (ADR) (NYSE:NQ): Seems to Get Clean Chit


Dallas, Texas 05/01/2014 (FINANCIALSTRENDS) –  NQ Mobile Inc. (ADR) (NYSE:NQ), headquartered in Beijing, yesterday provided independent investigation’s status report into the allegations made by Muddy Water during October 2013. Short seller Muddy Waters alleged NQ mobile for operational and accounting irregularities. Yesterday, NQ Mobile announced that it has not found any evidence supporting the fraud claims made by Muddy Waters.

Company Statement:

The company revealed in yesterday’s statement, “The investigation team has thus far found no evidence that the company engaged in the fraudulent conduct that was alleged by Muddy Waters,” and added, “The company expects to file its annual report as soon as practicable following the conclusion of the investigation and the completion of the review of its financial statements by its independent auditor.”

As a remainder to our investors, NQ Mobile Inc. (ADR) (NYSE:NQ) had previously stated that it would release the report by the end of April 2014 which is also its deadline with the U.S. SEC (Securities and Exchange Commission) for its year end filing. However, Yesterday Company revealed that it has filed with the U.S. SEC and sought 15-day extension.

The Investigation:

Following the research published by Muddy Waters which alleged NQ Mobile for posting fraudulent sales figures, the company hired an independent committee in November to audit its finances. Over the course of time, the committee conducted far-ranging investigation into NQ Mobile’s financial records, its business partners and the acquisitions. Yesterday the company said in a press release that the investigation is nearly complete.

Moreover, the work and all relevant evidence related to investigation has also been discussed with the NQ Mobile Inc. (ADR) (NYSE:NQ)’s independent auditor by the committee. It is also said that NQ Mobile’s management and staff were fully cooperative during the investigation.

Stock Update:

Following this press release, NQ Mobile’s stock shoot up 10.75% and closed at $12.36 on Wednesday. However, stock is still trading more than 50% below its 52-week high of $25.90.

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