Are Baidu and iQiyi's Short-Seller Headaches Finally Over?
Back in April, Chinese video streaming company iQiyi (NASDAQ: IQ) was hit by allegations of fraud. Wolfpack Research and short-seller Muddy Waters, which spotted Luckin Coffee's fraudulent accounting before the regulators did, accused iQiyi of inflating its revenues by 27% to 44% in 2019.
Moreover, Wolfpack claimed iQiyi had inflated its revenues all the way back to 2015, long before its spin-off from Baidu (NASDAQ: BIDU) in 2018. That timeline seemingly implicated Baidu, which maintains a majority stake in iQiyi, and both stocks initially sank. Those troubles worsened in August, when iQiyi disclosed an SEC probe of its accounting practices.
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Source Fool.com
