United States (US) Securities and Exchange Commission (SEC) on Monday filed charges against Dozy Mmobuosi, Nigerian businessman, and three companies of which he is CEO, alleging they inflated the financial performance of the companies and key subsidiaries to defraud investors.
The SEC said in a statement said that it filed charges in U.S. District Court in New York against Mmobuosi, who made headlines this year following a bid to buy an English premier league team.
The SEC also charged Tingo Group, Agri-Fintech Holdings and Tingo International Holdings for violating the anti-fraud provisions of the federal securities laws and Nasdaq reporting and internal controls.
Tingo Group’s shares slumped in June after short-seller Hindenburg Research criticized its founder and alleged that the fintech firm had “fabricated” its financials.
Tingo categorically refuted all the allegations of the report, saying it was full of “misleading and libellous content”.
The company also said it had hired a law firm to conduct an independent review of Hindenburg’s claims.
The SEC imposed a two-week suspension of trading in Tingo Group’s securities on Nov. 14 following investigations.
Nasdaq advised it will continue to keep the company’s securities halted pending a review, Tingo Group said in a statement.
Tingo Group said in a statement on its website that it would “fully cooperate” with regulators.
The SEC alleges that, since at least 2019, Mmobuosi falsified financial statements and other documents of the three companies and their Nigerian units Tingo Mobile and Tingo Foods.
The complaint further alleges Mmobuosi made material misrepresentations about their business operations and financial success, and siphoned off funds for his benefit.
“Mmobuosi and the entities he controls have fraudulently obtained hundreds of millions in money or property through these schemes,” the SEC statement said.
The SEC is seeking emergency relief freezing Mmobuosi’s assets and prohibiting the three companies from transferring money or property or issuing shares to Mmobuosi.
The SEC also seeks an order preventing the defendants from selling or disposing of their respective holdings in Agri-Fintech or Tingo Group and prohibiting them and their agents from destroying, altering, or concealing records and documents.
In a statement SEC said its investigation, supervised by Tejal D. Shah, is still ongoing.