Just one day after its initial report, short-seller Capitalwatch has released explosive new claims, stating that the allegations against AppLovin only reveal the tip of a vast money laundering network. The core of the investigation is not solely targeting AppLovin, but rather tracing the flow of illicit funds originating from the Chinese P2P platform "Tuan Dai Wang." They discovered these funds, through a complex underground network, have been injected into over a dozen U.S.-listed companies, including AppLovin. Capitalwatch claims to possess crucial evidence which has already been submitted to regulators, and has stated that "the best is yet to come." Both the U.S. Securities and Exchange Commission (SEC) and the Committee on Foreign Investment in the United States (CFIUS) reportedly downloaded the full text of their report yesterday.
Tracing the flow of "Tuan Dai Wang" funds has led to the implication of over a dozen U.S.-listed companies. In a newly published article titled "AppLovin is Just the Tip of the Iceberg! Deep Dive into the Money Laundering Chain: We Are Uncovering a Scandal That Will Shock Wall Street," a Capitalwatch macro analyst elaborated on the background of this short-selling campaign. The article clarifies that the institution's initial target was not AppLovin, but rather "tracing the flow of funds." According to Capitalwatch's description, their team discovered a shocking flow of capital while tracking billions of dollars illegally transferred out from the defunct Chinese P2P platform "Tuan Dai Wang." The article states: "These illicit funds were transferred overseas via Chinese underground banks; they were split into countless small amounts and subjected to complex structuring; ultimately, this 'black money' was injected into more than ten U.S.-listed companies."
The analyst stated bluntly in the article: "AppLovin is just one piece of this massive money laundering puzzle. There are over a dozen other companies intricately linked to this, and our team is working around the clock to follow these leads." This statement suggests that Capitalwatch's short-selling action might be just the beginning of a series, potentially leading to similar compliance challenges for other U.S.-listed companies in the future. "Nuclear-level" evidence has been transferred to U.S. regulatory agencies. Responding to market questions about why more original evidence hasn't been made public, Capitalwatch countered that it holds highly sensitive, "nuclear-level" original materials. However, citing legal prudence and the need to protect informant safety, they have temporarily chosen not to publicly release these documents. Nevertheless, the institution explicitly stated that this batch of "nuclear-level" material is now within the purview of regulators. The article claims: "We have formally submitted the complete, organized, and cataloged chain of evidence to U.S. regulatory agencies." To substantiate this claim, Capitalwatch included a screenshot in the article showing website backend access logs from U.S. government agency IP addresses.
The analyst emphasized in the article: "Backend data shows that the U.S. SEC and CFIUS downloaded the original version of our report yesterday." Capitalwatch believes that although regulatory processes move slowly, "once they grind into action, they will crush all lies." Responding to the stock price increase: Short-term volatility cannot conceal the authenticity of the evidence. Addressing the phenomenon of AppLovin's stock price rising instead of falling after the short report's release, Capitalwatch appeared notably unperturbed. The analyst wrote: "All of this was within our expectations." Capitalwatch argues that AppLovin, as a company powered by algorithms and exhibiting exponential growth, possesses strong moats and the capacity for a capital-backed counterattack. "When faced with accusations, a giant's first reaction is always to deploy all resources to prop up the stock price," the article stated. "Short-term stock price fluctuations cannot掩盖 the authenticity of the evidence." The institution reiterated that its position is not necessarily that AppLovin's management are co-conspirators, but pointed out that "capital markets should not become a safe haven for black money." Capitalwatch indicated that even if management was unaware, if the fund sources are proven to involve money laundering, the company would still face immense legal and delisting risks. Core Event: The Logic Behind the "Advertising as Money Laundering" Allegation The trigger for this event stems from the in-depth short report released by Capitalwatch yesterday. The report alleges that AppLovin's core shareholder, Hao Tang (identified as an associate of China's Tuan Dai Wang), and Chen Zhi, the controlling shareholder of Cambodia's Prince Group (identified as a transnational crime syndicate leader), constructed a money laundering network. The report details the so-called "Ad-Tech Laundromat" model: illicit funds are converted into advertising fees through the Cambodian app WOWNOW, flow into the AppLovin platform, and ultimately become legitimate U.S. dollar assets through revenue sharing and stock price appreciation. Furthermore, the report also accuses AppLovin's Array and AXON technology algorithms of objectively facilitating the distribution of gambling and scam applications. Capitalwatch stated at the end of its latest response: "This battle has only just begun. The best is yet to come."
