Kai-Fu Lee and Citron Continue to Duke It Out Over Soft Seller’s Ethics and Inaccuracies

Steven Millward
11:35 am on Aug 31, 2012

The former Google China boss Kai-Fu Lee made a stand against short sellers Citron Research earlier this week – and now the two parties continue to duke it out via open letters, debating the ethics of Citron’s attacks on US-listed Chinese stocks such as Qihoo (NYSE:QIHU). Citron, despite its claims of wanting to expose wrong-doing, makes no ethical guarantees of not trying to soft-sell or inflate stocks for its own profit.

Mr. Lee’s earlier broadside at Citron was aimed at its many factual errors in a report on another Chinese company, Sohu’s (NASDAQ:SOHU) Sogou search engine, and he wasn’t defending Qihoo as such. Citron, in its initial letter dated August 30th (see below), did not bring up the issue of its numerous inaccuracies in its latest report. Instead, Citron put forward an interesting challenge for Kai-Fu Lee:

We believe it is very risky for investors when they are encouraged to ignore common sense and obvious signs of management misdeeds. We have extended an open invitation for you to debate the topic on CNBC Asia if you ever agree to appear for a live discussion.

For Citron, one of the key “common sense” curveballs is Qihoo’s ad revenue and gaming ARPU claims. Those concerns date back to three earlier attacks by Citron on Qihoo (see: 1, 2, 3).

Here’s the initial letter of reply from Citron’s Andrew Left, followed by a response from Kai-Fu Lee that was posted the same day on his Weibo page:

So Mr. Lee, now the founder and CEO of startup incubator Innovation Works, is not keen to debate the topic, perhaps as it might be misconstrued in the media as defending Qihoo, a controversial local web company which made waves by launching its own search engine last week.

  • xlming

    The group of criminal hedgefunds individuals that are likely piling on shorts with Citron: Jim Chanos, David Einhorn, Steven A Cohen, and Daniel Loeb. Daniel Loeb is of importance to China because his hedgefund(s) owns 5% of Yahoo. Owning 1% of Alibaba Group.

    Below are facts about Daniel Loeb’s criminal activity and unethical behavior that you can use to expose him as a fraud at a national/international level with the Chinese media. It has not been done by the corrupted American media. This will give you and China the high ground.

    1. Daniel Loeb is directly connected to the Mafia — Genovese crime family. He was a key member of a short selling group that now has members serving jail sentences for racketeering, conspiracy, and securities fraud (see page 13-14 on below link). The same group boasted about paying off journalists, having corrupt friends inside the US government agencies that regulate the American stock markets, and conspiring to destroy public companies (such as Fairfax).

    2. Daniel Loeb’s hedgefund has worked in coordination with other hedgefunds to illegally manipulate the share prices of public companies

    3. Daniel Loeb had multiple identities on message boards where he was abusive, spread lies, and even harass officers of companies his hedgefund (Third Point) was shorting. Here is his message smearing the President of SFBC International:
    “…I will reciprocate [oral sex] with [SFBC President Lisa Krinsky] even though she has fat thighs, a fake medical degree, “queefs” and has poor feminine hygiene…”

    Daniel Loeb is a criminal, and is now a director at Yahoo, loading the board with his friends. This information must spread to anyone with relations to Yahoo, Yahoo China, Alibaba Group, and those who did business with them.

    1. http://www.deepcapture.com/wp-content/uploads/2009/08/deepcapture-the-story-v1.pdf (pages 13-15)
    2. http://www.deepcapture.com/was-dan-loebs-capital-allied-with-david-einhorns/
    2. http://www.deepcapturethemovie.com (near minute 32)
    3. http://www.deepcapture.com/daniel-loebs-first-amendment-riot/
    3. http://www.deepcapture.com/daniel-loeb-is-mr-pink-and-more/

    Happy Cleansing to Lee Kaifu

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