LOS ANGELES--(BUSINESS WIRE)--The Schall Law Firm, a national shareholder rights litigation firm, announces that it is investigating claims on behalf of investors of Huazhu Group Limited (“Huazhu” or “the Company”) (NASDAQ: HTHT) for violations of the securities laws.
The investigation focuses on whether the Company issued false and/or misleading statements and/or failed to disclose information pertinent to investors. Huazhu is the subject of a report issued by Bonitas Research on September 21, 2020. According to the report, the Company “lied about the ownership of its hotel portfolio to produce fake financials.” The report alleges that the Company secretly supported certain franchisee hotels owned by Company employees and other off-book hotels. Bonitas Research also alleges that it “believe[s] that Huazhu concealed operating expenses using undisclosed related party transactions to artificially inflate Huazhu’s reported profits[,]” and that it “calculate[s] that Huazhu’s fake profits manifested as RMB 2 billion (US$ 300 million) of fake PP&E on its CYE’19 balance sheet.” Based on this news, shares of Huazhu fell by more than 3.5% in intraday trading on the same day.
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