Addentax Group Corp. Initiates Task Force to Investigate Suspected Illegal Trading Activities

Rhea-AI Summary

Addentax Group Corp. (NASDAQ: ATXG) has announced the formation of a specialized task force to investigate alleged illegal trading activities targeting its stock. The Company suspects that unauthorized sales of a substantial volume of its shares have occurred, potentially as part of a market manipulation scheme aimed at depressing its stock value. In response, Addentax is exploring various actions, including engaging experts to detect fraud and insider trading related to short-selling. The Company is committed to taking legal measures against these activities to protect its shareholders and maintain its stock integrity.

Positive

• Formation of a task force to investigate illegal trading activities.
• Proactive measures to address market manipulation and protect shareholder value.

Negative

• Allegations of significant unauthorized sales of shares suggest potential market manipulation.
• Risk of short selling and naked short selling impacting stock price.

SHENZHEN, China, April 14, 2023 /PRNewswire/ -- Addentax Group Corp. ("Addentax" or the "Company") (Nasdaq: ATXG), an integrated service provider focusing on garment manufacturing, logistics service, property management and subleasing, and epidemic prevention supplies, today announced that it plans to assemble a specialized task force to investigate the alleged illegal trading targeting its stock. The Company believes that certain individuals or entities have participated in unauthorized sales of a substantial volume of its shares without securing proper delivery, in violation of the law. This illicit activity seems to be part of a market manipulation scheme designed to artificially depress the value of Addentax's securities.

In response to these concerns, Addentax is proactively evaluating potential actions, which may include engaging experts with a proven track record in detecting potential fraud, insider trading, and market manipulation related to short-selling activities.

Short selling, a legitimate investment practice, entails an investor borrowing shares from another party and selling them with the intention of repurchasing them at a lower price to make a profit. Conversely, naked short selling, the act of selling shares without first borrowing them, is strictly prohibited under the Securities and Exchange Commission rules.

By engaging in repeated instances of naked short selling, malicious actors can accumulate significant profits and manipulate a stock's price downward, potentially driving a company towards insolvency. In this situation, all equity is eliminated, and the naked shorts are no longer required to cover their positions.

Addentax remains steadfast in its commitment to conducting a thorough investigation of this matter and will take decisive action to pursue all available legal remedies.

About Addentax Group Corp.

Addentax Group Corp. is an integrated service provider focusing on garment manufacturing, logistics service, property management and subleasing, and epidemic prevention supplies. Its garment manufacturing business consists of sales made principally to wholesaler located in China. The logistics business consists of delivery and courier services covering 79 cities in seven provinces and two municipalities in China. The property management and subleasing business provides shops subleasing and property management services for garment wholesalers and retailers in garment market. The epidemic prevention supplies business consists of manufacturing and distribution of epidemic prevention products and resale of epidemic prevention supplies purchased from third parties in both domestic and overseas markets. For more information, visit the Company's website at https://www.addentax.com/.

Safe Harbor Statement

All statements other than statements of historical fact in this announcement are forward-looking statements in nature within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions are intended to identify such forward-looking statements. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to consider risk factors, including those described in the Company's filings with the SEC, that may affect the Company's future results. All forward-looking statements attributable to the Company and its subsidiaries or persons acting on their behalf are expressly qualified in their entirety by these risk factors. The forward-looking events discussed in this press release and other statements made from time to time by us or our representatives, may not occur, and actual events and results may differ materially and are subject to risks, uncertainties, and assumptions about us. We are not obligated to publicly update or revise any forward-looking statement, whether as a result of uncertainties and assumptions, the forward-looking events discussed in this press release and other statements made from time to time by us or our representatives might not occur.

Company Contact:

Addentax Group Corp
Phone: + (86) 755 86961 405

Investor Relations Contact:"
Sherry Zheng
Weitian Group LLC
1-718-213-7386
Shunyu.zheng@weitian-ir.com 

 

View original content:https://www.prnewswire.com/news-releases/addentax-group-corp-initiates-task-force-to-investigate-suspected-illegal-trading-activities-301797839.html

SOURCE Addentax Group Corp.

FAQ

What is Addentax Group Corp. doing about illegal trading of its stock?

Addentax Group Corp. is forming a specialized task force to investigate alleged illegal trading activities and potential market manipulation.

What are the concerns regarding Addentax Group Corp.'s stock?

The Company has concerns about unauthorized sales of its shares, which may be part of a scheme to depress its stock value.

What actions is Addentax Group Corp. considering for market manipulation?

Addentax is considering engaging experts to detect fraud and insider trading related to alleged illegal activities.

How does short selling relate to Addentax Group Corp.'s situation?

Short selling involves selling borrowed shares and can lead to market manipulation, particularly if done illegally through naked short selling.

What is naked short selling, and why is it a concern for Addentax Group Corp.?

Naked short selling is selling shares without borrowing them first, which is illegal and can impact a company's stock price negatively.