Globo's CEO, CFO Resign After Unveiling Falsified Financial Data

  • Global’s shares suspended after Quintessential report
  • Quintessential has opened a short position in the stock

Globo Plc’s chief executive officer and chief financial officer have resigned after telling the company’s board about falsified data after short-seller Quintessential Capital Management alleged the company lied about its financial position.

At a board meeting of the U.K.-based software maker Saturday, CEO Costis Papadimitrakopoulos and CFO Dimitris Gryparis told the board about “the falsification of data and the misrepresentation” of Globo’s financial information. Chief Operating Officer Gerasimos Bonanos was suspended as the company investigates further, it said Monday in a statement. Globo told its lawyers to report the matter to authorities and its principle bankers.

Papadimitrakopoulos and Gryparis couldn’t immediately be reached to comment on the matter.

Global’s stock was suspended last week after Quintessential alleged that while a minor portion Globo’s business is authentic, its investigation suggests that “at least” 60 percent of sales are fabricated. At the time, Papadimitrakopoulos refuted the claims made in the report.

“We are of the view that Globo Plc is massively overstating its revenue and profit by generating fictitious sales invoices from shell companies created and controlled by Globo to pose as legitimate clients,” Quintessential said in its report. It has opened a short position in the stock, it said.

Shares in Globo have tumbled 29 percent this year, valuing the company at 106 million pounds ($162 million).

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