Temenos Dismisses Hindenburg Report after Committee Findings

Core banking provider Temenos has concluded a probe that has determined that a report by Hindenburg Research is “inaccurate and misleading.’

In February 2024, Hindenburg tabled a report accusing Temenos of “accounting irregularities, failed products and an illusive turnaround.” Hindenburg went ahead and shorted Temenos stocks because of the claims.

The Hindenburg report saw Temenos shares record a significant price decline. On the day the report was published, the company’s shares dropped by 25%. However, Temenos has now rubbished the claims after an independent investigation was done.

Temenos Concludes Probe into Hindenburg Claims

In February, Hindenburg conducted a study that involved 25 former executives at Temenos. The report accused Temenos of failing to be truthful in its operations and processes. This prompted the Temenos board to create a special committee. The committee was led by the executive chairman Thibault de Tersant.

Two law firms and two foreign accountants were also part of the committee. Temenos said that the committee had unrestricted access to executives at the company. They could also access all the relevant documents including company records and communications.

The committee reviewed over 300,000 documents and electronic communications. They also held interviews with 17 current and former employees at Temenos. The goal of the committee was to find out whether there was some truth to the claims made by Hindenburg.

The committee determined that Hindenburg Research made ‘incorrect and misleading allegations about Temenos and its accounting, products and customer relationships and presented purported facts about Temenos in a distorted manner or out of context.”

Temenos Chairman, Tersant, noted that the findings of the committee reinforced the view of the board that the company was running a sound business. He also said that the company offered the best-in-class products and had solid financial controls and governance oversight. Tersant affirmed that Hindenburg would continue serving its clients and creating relationships with its partners.

Temenos is also planning on appointing a new CEO who will take the helm of leadership at the company before the shareholder meeting set for next month.

Hindenburg Dismisses Findings

Hindenburg has dismissed the findings of the committee saying the report found evidence of backdating. There were seven instances of backdating in the findings of the committee, but the language used by the lawyers helped in taking the weight out of such a grave accounting error according to Hindenburg.

“While the examination leads by saying we made “inaccurate and misleading allegations,” the content of the examination’s findings indicates the opposite – a tacit confirmation of accounting manipulation and disclosure violations at Temenos, spun with lawyer-speak and gaslighting,” Hindenburg said.