The case against Sino-Forest

for more on the China stock scandal: • What’s behind the great China stock scandals? • The China stocks under the microscope

Sino-Forest, according to its own description, is “a leading commercial forest plantation operator in China, [which] operates and manages approximately 894,200 hectares of plantations (as at June 30, 2011) and downstream manufacturing operations spanning eleven key provinces across China”. The essence of Muddy Waters’ case is that the company runs most of its revenues through authorized intermediaries (AIs), third-party timber trading customers that “purportedly pay much of TRE’s value-added and income taxes.