What really happened to Dozy Mmobuosi Tingo Group stock?

Tingo Group (NASDAQ: TIO) stock price has been frozen in the past two months as woes in the company have intensified. After peaking at $5.69 in May 2023, the shares had crashed to $0.69, erasing over $3 billion in value. 

Tingo Group stock

Was Tingo Group a scam?

Tingo Group is a Nigerian company that came in the spotlight in 2023 after Hindenburg Research published a scathing report on its operations. In summary, the report highlighted how Tingo and Dr. Dozy Mmobuosi, faked their way to Wall Street by running an elaborate scheme.

The report also identified Dozy’s wrong academic background by confirming that he did not attend a university in Malaysia. Most importantly, the report found that the company was faking financial reports in a bid to boost its stock. 

There were other red flags identified in the report. For example, the launch of Tingo Airlines was a fake operation as the company used stock photos for the event. The launch of its agro-processing plant in Nigeria, where the minister attended, was an elaborate scam as well.

This report got the attention of the Securities and Exchange Commission (SEC), which sued Dr. Dozy and his three companies. The SEC repeated most of the accusations that Hindenburg Research had noted. 

According to the SEC, Tingo Group’s 10k noted that it had over $461 million in cash and equivalents. In reality, those accounts had just $50. The SEC added that:

Meanwhile, Nasdaq suspended the stock as it requested more details about its filings and the accusations made by the SEC. The initial suspension was just for a few days but Nasdaq has maintained it as it waits for more information.

Was Tingo Group a scam?

To be clear. The accusations by the SEC and Hindenburg Research are merely allegations and the accused have not been convicted in a court of law. They have also denied these allegations and vowed to vigorously defend themselves.

However, a novice look at the situation can confirm that Tingo Group was indeed a scam. For example, its most recent results showed that the company’s revenue in the third quarter stood at over $2.4 billion. That was a big increase from the $35 million it made in the same period in 2022.

It also became extremely profitable in a short period of time. It moved from a net loss of $32 million in Q3’22 to a net profit of $457 million. These are big and unreal numbers for a company in any industry.

This growth was mostly because of the company’s acquisition if Tingo Foods, a company that Dr. Dozy built independently. In the first 8 months since its acquisition, Tingo Foods brought in $1.16 billion and an operating profit of $427 million. Keep in mind that Nigeria is not a substantial food exporter.

What next for Tingo Group stock?

Tingo Group stock has now been frozen by Nasdaq as it awaits more information. It is not clear when the current halt will end. What is clear, however, is that the stock has no chances of survival in the near and the long term. 

The SEC and Hindenburg Research have proven that the company operates a scam intended to enrich its key shareholders. Its financial results are a mirage while Tingo Mobile users are almost nonexistent.

Therefore, I suspect that Tingo Group stock faces a bleak future ahead if or when it is allowed to trade in the US.