Alleged inquiry comes amid claims server maker cooked its books
Supermicro has reportedly fallen under the scrutiny of the US Justice Department amid allegations the US-based server vendor is cooking its books.Reports that prosecutors for the US attorney's office were searching for evidence to support a case against Supermicro sent the company's shares into free fall on Thursday with prices plummeting over 16 percent.
There have certainly been no shortage of red flags raised in recent months to arouse investigators suspicions. The alleged inquiry, which is apparently in the very early stages, comes after former Supermicro employee Bob Luonga whistleblower lawsuit against the system builder claiming it had misreported revenues by booking sales and billing customers on incomplete orders.
CEO Charles Liang has since refuted these allegations claiming the report"contains false or inaccurate statements," the WSJ reported. Despite Liang's denial, it wouldn't be the first time that Supermicro's accounting practices have landed him in hot water. Back in 2020, the Securities and Exchange CommissionFurther complicating the matter is that Supermicro is nearly a month late in releasing its 10-K annual report. The firm initiallyreached out to the Department of Justice and Supermicro for comment, but had not heard back at the time of publication.
Supermicro isn't the only company that has seen its shares tank on spooky reports of investigations in recent weeks. Earlier this month, Bloomberg citing unnamed sources,that the DoJ had stepped up its investigation into Nvidia and had issued subpoenas seeking evidence to build its case against the chip biz.
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