Capitalwatch fires again: AppLovin is just the tip of the iceberg in the money laundering industry chain, with more than a dozen other companies involved; "nuclear-level" evidence has already been handed over to regulators.
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Wallstreetcn reported yesterday that short-selling firm Capitalwatch released a heavyweight report, accusing AppLovin's core shareholder Hao Tang of colluding with the head of a transnational criminal organization, using Cambodia's super app WOWNOW to convert illegal funds into advertising fees flowing into AppLovin, thus completing a money laundering loop.
Just one day later, Capitalwatch dropped another bombshell, claiming that the allegations against AppLovin are only the tip of the iceberg of a massive money laundering network. The institution's investigation core does not simply target AppLovin, but rather tracks the flow of illegal funds from the Chinese P2P platform "Tuandai.com". They found these funds, through complex underground networks, were injected into more than a dozen US-listed companies including AppLovin.
Capitalwatch claimed, they are holding key evidence which has already been submitted to regulators, and vowed that "the real show is yet to come". The US Securities and Exchange Commission (SEC) and the Committee on Foreign Investment in the US (CFIUS) downloaded the full text of their report yesterday.
Tracking the Flow of "Tuandai.com" Funds Leads to Over a Dozen US-listed Companies
In the latest article "AppLovin Is Only the Tip of the Iceberg! A Deep Dive into the Money Laundering Chain: We Are Unveiling a Scandal That Makes Wall Street Tremble", Capitalwatch macro analyst detailed the background of this short-selling operation. The article pointed out that the institution's original target was not AppLovin, but "tracking the flow of funds".
According to Capitalwatch, their team discovered a shocking funding chain while investigating the billions of dollars of illegal funds transferred out of the now-defunct Chinese P2P platform "Tuandai.com". The article stated: “These illegal funds are moved out of the country via Chinese underground banks; they are split into countless small amounts and processed in a complex, structured way; eventually, this ‘dirty money’ is injected into more than a dozen US-listed companies.”
The analyst bluntly stated in the article: "AppLovin is merely a piece of this huge money laundering puzzle. There are more than a dozen companies with intricate links to it, and our team is working around the clock to track these leads." This statement implies that Capitalwatch's short-selling may only be the beginning of a series of actions, and more US-listed companies will likely face similar compliance questions in the future.
"Nuclear" Evidence Handed Over to US Regulators
In response to market doubts such as "Why not make more original evidence public?", Capitalwatch replied that they are in possession of highly sensitive "nuclear-level" original materials, but for legal prudence and to protect informants' safety, they have temporarily chosen not to disclose these originals.
However, the institution made it clear that these "nuclear-level" materials are now on the regulators' radar. The article said: "We have formally submitted the organized and cataloged complete evidence chain to US regulators." To prove this claim, Capitalwatch posted a screenshot of their website backend, showing access records from IP addresses belonging to US government agencies.
The analyst emphasized in the article: "Backend data shows that the US SEC and CFIUS downloaded the full text of our report yesterday." Capitalwatch believes that although the regulatory process is relatively slow, “once it runs its course, it will crush all lies.”
Response to Stock Price Rise: Short-term Fluctuations Cannot Cover Up the Authenticity of Evidence
In response to AppLovin's stock price rising instead of falling after the release of the short-selling report, Capitalwatch appeared quite calm. The analyst wrote: "All of this is within our expectations."
Capitalwatch believes that AppLovin, as a company driven by algorithms and with exponential growth, possesses a strong moat and capital counterattack capacity. "When confronted with allegations, a giant's first reaction is always to use every resource to maintain its stock price," the article states, "Short-term stock price fluctuations cannot cover up the authenticity of the evidence."
The institution reiterated that its position is not that AppLovin management must be conspirators, but pointed out that "the capital market should not be a safe haven for dirty money". Capitalwatch stated that even if management is unaware, if the source of funds is proven to involve money laundering, the company will still face great legal and delisting risk.
Core Incident: The Logic Behind the "Advertising is Money Laundering" Allegations
The catalyst for this event stemmed from Capitalwatch's in-depth short-selling report released yesterday.
Wallstreetcn wrote that the report accused AppLovin's core shareholder Hao Tang (alleged as an affiliate of China's Tuandai.com) and Prince Group's Chen Zhi in Cambodia (alleged to be the head of a transnational criminal organization) of constructing a money laundering network.
The report detailed the so-called "Ad-Tech Laundromat" model: illegal funds are converted into advertising expenses through the Cambodia app WOWNOW and flow into the AppLovin platform, ultimately becoming legitimate US dollar assets via revenue sharing and stock price gains. Furthermore, the report accused AppLovin's technologies Array and AXON of objectively facilitating the distribution of gambling and scam software.
At the end of its latest reply, Capitalwatch stated: “This battle has only just begun. The real show is yet to come.”
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