(Bloomberg) — Super Micro Computer Inc. is under investigation by the US Justice Department following a short-seller report that raised questions about the company’s accounting practices, the Wall Street Journal reported.
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A prosecutor at the US attorney’s office in San Francisco recently reached out to people who possibly held relevant information, according to the report. The prosecutor was seeking information that appeared to be related to a former employee who accused the company of accounting violations and had earlier filed a whistleblower lawsuit against the company and its chief executive officer, according to the report.
The shares fell as much as 17% to $382.29 in New York on Thursday, marking the biggest decline in almost a month. They had been up 61% this year through Wednesday.
Representatives of Super Micro Computer and the Justice Department didn’t immediately respond to requests for comment.
In August, Hindenburg Research wrote that the company had “glaring accounting red flags, evidence of undisclosed related party transactions, sanctions and export control failures, and customer issues.”
–With assistance from Chris Strohm and Ian King.
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