Fraudulent actions in the stock market, especially involving IT companies, tend to backfire and cause acute problems. Temenos, a Swiss company that develops software for banks, saw its shares drop by a whopping 33.88% to 58.5 Swiss francs on the SIX Swiss Exchange. As a result, Temenos Group's shares plummeted by 29% to 62.78 Swiss francs. Today, many investors are selling Temenos shares after Hindenburg Research, an American company that studies investments, published reports on the Swiss company. The documents read that Temenos Group had manipulated its earnings reports, unveiling major accounting irregularities. After the reports came out, Temenos lost $2.4 billion in value. Bloomberg noted that this was the biggest loss since 2002. Hindenburg Research’s investigation spanned four months and culminated in the identification of telltale signs of income manipulation, accounting irregularities, as well as other red flags. One example they found was Temenos secretly paying for its software, engaging in a roundtripping scheme. They also found documents showing talks with 25 ex-workers, including those from the company’s top management. Notably, a former Temenos executive disclosed to Hindenburg Research that the company engaged in retroactive contract adjustments, enabling the manipulation of profit allocation to earlier periods.
