Sino-Forest Sinks After Denying Short Seller’s Accusations

Sino-Forest Corp., whose largest shareholder is hedge fund Paulson & Co., plunged a second day after a short seller said the forestry company overstated timberland holdings and production, an allegation it denied.

It sank 64 percent to C$5.23 at 4 p.m. in Toronto. Sino-Forest fell 21 percent yesterday after Muddy Waters LLC, an investment firm run by Carson C. Block that’s betting against Sino-Forest, said the company is a “fraud.” Sino-Forest has lost more than C$3 billion in market value since June 1.