Named after the 1937 airship disaster, Nathan Anderson’s five-person firm hunts for financial problems and publishes reports that poke holes in business stories. Its report on the Adani group, which includes companies such as Adani Power and Adani Green Energy, was scathing in its allegations of corporate fraud and misfeasance in office. Anderson, a 38-year-old former analyst for market data firm FactSet and brokerage dealer firms in New York, says he spends three to six months researching a company before releasing a report.
He and his team scour public documents and speak to insiders and advisers to find a deeper story. Their reports usually highlight allegations of financial wrongdoing, including fraud, money laundering, and Ponzi schemes. Anderson’s firm, Hindenburg Research, isn’t a fund but an activist short seller that makes a profit when the value of its targeted businesses plummets after it publishes unflattering reports about them.
The US-based group takes a position in the shares of the company it targets and then trades them for a profit after its research is published. It is an illegal practice, though one that has grown into a cottage industry as investors have sought to beat the stock markets. Proponents of the strategy say it’s a necessary part of a market to keep share prices in check and prevent them from running too high.
Timur Turlov is still trying to understand how the short seller’s bet against his Kazakh brokerage backfired so much that, at one point, it left him with a paper windfall of more than $1 billion. The US short seller aimed the Kazakh billionaire’s Freedom Holding Corp. in August with accusations that ranged from fraud and market manipulation to circumventing sanctions. But days later, the company’s stock surged to a record.
