Taiwan probes HTC claim against analyst

Taiwanese smartphone maker HTC has accused a local employee of global banking giant Citigroup of spreading “false news” about the firm to encourage a plunge in its share price, reports said yesterday.
A spokesman at the Taipei district prosecutor’s office confirmed that an investigation had been going on since August, when HTC filed a complaint, but declined to elaborate on the details of the case.
According to the Commercial Times daily, HTC accused an analyst at the Taiwanese unit of Citigroup Global Markets Inc, the US bank’s brokerage and securities arm, of seeking to manipulate its share price for profit.
HTC’s share price reached a record Tw$1,300 (USD 43) on April 29 but has since tumbled 68 percent, closing at Tw$415 on Monday. During the same period the Taiwanese stock market fell 23 percent.
Investors can make money on declining share prices by selling short, where they sell shares they do not own before buying them back at a lower price later.
Apparently alarmed by the steep falls, HTC issued a statement earlier this year warning that it would not rule out taking legal action against anyone who spread false information about the company.
HTC declined to comment when contacted by AFP while a Citigroup spokesperson was not available for comment.
HTC sells its own smartphones and also makes handsets for a number of leading US companies, including the Nexus One unveiled by Google.