As highlighted in this prior post, in late 2017 Muddy Waters Research (a short seller investment firm) accused OSI Systems (a California based company that develops and markets security and inspection systems such as airport security X-ray machines and metal detectors) of corruption in Albania. (See here for more). A Muddy Waters representative confidently stated that it had “smoking-gun proof that, when this company got a turn-key contract a few years ago in Albania, worth $150-$250 million top line, that they paid a bribe or kickback of almost half of that concession. To me, this is damning evidence.”
Thereafter, OSI’s stock price fell approximately 30% and sure as dogs bark and the sun rises in the east, plaintiff’s lawyers mobilized and very soon securities fraud class actions and derivative actions were filed which closely tracked the allegations set forth in the short-seller’s report.
