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  "documentTitle": "Joyy Inc. (YY)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson Block",
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  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2020-11-18 00:00:00",
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  "notes": "This slide presents a series of investigative findings regarding corporate fraud, specifically focusing on revenue inflation and fake user activity.",
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      "text": "“Big Li” is a big lie.",
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      "text": "Bigo's rot stems from its inception. YY claims that it purchased Bigo from Chairman David Li. This is a lie that enabled Chairman Li to take at least $156.1 million of real money from YY shareholders and for YY to fraudulently report remeasurement gains in its profits. In reality, YY founded Bigo – not Chairman Li.",
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      "text": "We lay out findings from four additional top-earning performers, four more Top PUs, and numerous interviews with senior members of the YY ecosystem supporting our finding that YY Live and Bigo are a sham and their gift revenue is substantially fake.",
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      "text": "Studying various purportedly top earning performers closely shows the enormity of the fraud on a micro level:",
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      "text": "\"Big Li\" is a big lie. Big Li won YY's 2019 annual competition for the most gifts received. However, our data shows that during this December event, Big Li's mobile device was shared with his largest contributor, who sent RMB seven million in gifts, or approximately 40% of the total. Beyond that, devices associated with his sent more in gifts than Big Li received, laying bare a network of related accounts that recycle gifts and inflate YY's revenue totals.",
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      "text": "Top Bigo earner RCT_Khan purportedly receives ~$50,000 in gifts per month for literally sitting at his desk doing paperwork. His stream gets even less enthralling, with the camera often pointed at the wall or ceiling. Until very recently, his purported #2 contributor was clearly himself. (His other top contributors are almost certainly part of a gift recycling network.)",
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      "text": "Purported pop music success Modern Brothers gives free concerts in a popular shopping area, and yet attendee \"fans\" are paid to show up. Modern Brothers rarely performs on YY Live these days, but they receive gifts continuously through the platform when off air. Many of these gifts were coming from YY's servers. Analyzing data from 96 randomly selected purported donors shows that ~97.9% of sampled gift revenues were likely fake.",
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      "text": "A random sample of YY PUs in Wuhan during its COVID-19 lockdown indicated that ~87.5% of their gift revenues were likely fraudulent. The majority of the fraudulent PUs had mobile device IDs (IMEIs) linking back to YY servers, while a significant minority of Wuhan PUs displayed IP addresses that inexplicably jumped from city to city amid the lockdown.",
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      "text": "We researched YY's businesses for more than one year, taking a two-prong approach. The first prong was macro data collection and analysis through automated means of 115.6 million transactions. The second prong was traditional Muddy Waters techniques of reviewing filings and accounts, undercover fieldwork, and human sourcing.",
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      "text": "Bigo consolidates a significant amount of revenue from Mainland China. Bigo tacked on a mainland China business Hello that we believe to be almost entirely fake, per our primary diligence and discussions with former Bigo employees. As of Q3 2020, we estimate this overwhelmingly fraudulent PRC unit was still 13.4% of Bigo's reported revenues.",
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