Business Leadership South Africa (BLSA) on Thursday published a report that makes damning findings about the company Viceroy, which it describes as a ‘short seller’.

Viceroy has over the past year published negative reports on prominent South African companies, including Steinhoff and Capitec bank.

Short selling is defined as the sale of an asset in the belief that the asset’s price will decline. This enables it to be bought back at a lower price to make a profit. BLSA commissioned the report from the research house Intellidex.

Business Leadership South Africa says it stands by its commissioned report and that Viceroy has used the status it gained from its Steinhoff report – in order to publish fake and weak reports about other companies that had the effect of damaging their share prices.

BLSA CEO Bonang Mohale says short selling is a new phenomenon in South Africa and his organisation felt it was important to commission a research that would draw out the facts and equip the public to separate good from bad practices.

“This is not an anti -short selling research and also this research is not a viceroy report , we looked at a number f companies that do short selling. And lastly this is not a report that has been paid for by Capitec. Capitec is a member of Business leadership South Africa. We have 85 CEOs and our membership fees is public knowledge. So indirectly Capitec has paid for this report through their membership and so did Investec and Standard Bank.”

Other key findings from Intellidex – was that Viceroy’s report on Steinhoff  was substantially plagiarised from a report produced by a different hedge fund six months earlier.

In addition, there are several problems with other Viceroy reports, including Capitec and Advanced Micro Devices, such as unsupported exaggerations, poor reasoning and misunderstandings of the markets they operate in.

Chairman of Intellidex, Stuart Theobald says, “Plagiarism means to use someone work without acknowledging them and if you really think why people would copy someone else work without acknowledging them, its often because they want to create public perception that they know more about something then they really do. And the viceroy report does nothing but take the CT labs technology reports and then change the language to make it more inflammatory.”

National Treasury described Viceroy’s actions as ‘reckless’ and ‘not acting in the public interest’- saying there is plenty of excellent short-side research, but analysis indicates that Viceroy’s work does not fit in this category.

Theobald argues that Viceroy has failed to meet professional research standards. “We analysed the media coverage of Viceroy and in fact until it published its Steinhoff report in December last year, there was almost no coverage of its research and its research didn’t really have that much of an impact. What I find concerning Viceroy is that they claim to receive significant amount of anonymous data that they then use and you can’t ran to press with an anonymous tip off that you have received.”

Although Viceroy did not directly respond to Intellidex, the research company has hit back on the allegations and says they have no business relationship with any individuals or funds cited on the Intellidex report.

They further added that all their data and analysis are back checked- and only publish when they are satisfied with accuracy and validity. Intellidex says they have submitted the report to the South African financial services conduct authority.