(Bloomberg) — Super Micro Computer Inc. is under investigation by the U.S. Justice Department following a report by short sellers that raised questions about the company’s accounting practices, the Wall Street Journal reported.
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A prosecutor from the U.S. attorney’s office in San Francisco recently contacted people who may have had relevant information, the report said. The prosecutor was seeking information that appeared to be related to a former employee who accused the company of accounting violations and who had previously filed a whistleblower lawsuit against the company and its chief executive, the report said.
Shares fell as much as 17% to $382.29 in New York on Thursday, the biggest drop in nearly a month. Through Wednesday, they were up 61% this year.
Representatives for Super Micro Computer and the Justice Department did not immediately respond to requests for comment.
In August, Hindenburg Research wrote that the company had “clear accounting red flags, evidence of undisclosed related-party transactions, sanctions and export control lapses, and customer issues.”
–With assistance from Chris Strohm and Ian King.
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