In a shocking turn of events, the U.S. Securities and Exchange Commission (SEC) has filed charges against Tingo Group, a Nigerian “agri-fintech” company, accusing it of engaging in a “massive fraud.” The SEC alleges that Tingo Group, including its partners and financials, fabricated nearly every aspect of the company, describing it as an “astonishing audit failure.”
The charges were filed following an earlier report by short seller Hindenburg Research on June 6, which labeled Tingo Group as “an exceptionally obvious scam with completely fabricated financials.” The SEC’s release on Monday disclosed that the agency has obtained a temporary asset freeze and restraining order against Tingo Group’s founder, Dozy Mmobuosi. The SEC accuses Mmobuosi of orchestrating a “multi-year scheme to inflate the financial performance metrics” of Tingo Group and its subsidiaries, deceiving investors globally.
According to the SEC, Mmobuosi led a scheme to fabricate financial statements and documents for Tingo Group Inc., Agri-Fintech Holdings Inc., and Tingo International Holdings Inc., along with their Nigerian operating subsidiaries. One egregious example cited by the SEC is Tingo Group’s claim of having $461.7 million in cash, while its bank accounts reportedly held less than $50 at the end of fiscal year 2022.
The SEC alleges that Mmobuosi and the entities under his control fraudulently obtained hundreds of millions of dollars in money or property through these deceptive schemes. Antonia M. Apps, Regional Director of the SEC’s New York Regional Office, emphasized the brazen nature of the alleged scheme, stating, “Mmobuosi spearheaded a brazen scheme using phony records and fictitious entities to make the Tingo companies he controlled appear highly profitable.”
Notably, Hindenburg’s Nathan Anderson highlighted an “astonishing audit failure” by Deloitte Israel, which provided Tingo with a clean audit opinion for 2022 and was seeking to continue working with the company for 2023.
Hindenburg, in their June report, expressed a scathing assessment, calling Tingo a “worthless and brazen fraud that should serve as a humiliating embarrassment for all involved.” Tingo, in response, labeled the Hindenburg report as containing “misleading and libelous content.” The SEC’s charges add a significant layer to the controversy surrounding Tingo Group, raising questions about regulatory oversight and due diligence in the auditing process.
