Capital markets watchdog looks into Folli Follie share plunge

Greece’s capital markets watchdog has asked retailer Folli Follie to appoint an independent auditor to check over its 2017 financial reports after an equity fund accused the Greek company of overstating how many selling points it has worldwide.

Last week, equity fund Quintessential Capital Management questioned the size of Folli Follie’s network in a report, sending its shares down 30 percent lower on Friday. On Monday, the stock fell a further 30 percent.

Folli Follie has described the report as being “unfounded, false, defamatory and misleading.”

The Capital Market Commission said that it will check into the auditor that signed off Folli Follie’s 2017 figures and will ask Quintessential Capital Management for details of its claims.

“As is common with these significant fluctuations, we are looking into the share transactions of Folli Follie, including the short positions on the stock on Friday,” added the commission in a statement.

Short positions are when investors make money from a stock, betting that it will drop in the future.