Shares of Super Micro Computer (SMCI) fell 2 percent early Tuesday after a report from short seller Hindenburg Research alleged, among other things, “balance sheet manipulation” at the AI ​​high-flyer. Super Micro shares had fallen as much as 8 percent in premarket trading following headlines about Hindenburg’s report.

Hindenburg Research said its three-month investigation “revealed glaring accounting red flags, evidence of undisclosed related party transactions, sanctions and export control violations, and customer issues.” The firm said Tuesday it had taken a short position in Super Micro.

Yahoo Finance reached out to Super Micro but had not received a response from the company at the time of publication.

The maker of data center servers and management software caught investors’ attention this year as it rode the AI ​​wave. The company is buying components from AI chip maker Nvidia (NVDA).

Super Micro shares rose from $290 in early January to over $1,200 in March. While the stock is down about 50% from its March result, it is still up 90% year-to-date. The company recently announced a 10-for-1 stock split, effective October 1.

In his report, Hindenburg alleged that Super Micro’s business practices had not improved despite a $17.5 million settlement with the SEC in August 2020 following an investigation into “widespread accounting violations” and that senior executives who left the company in the wake of the scandal were later reinstated.

The report quotes a former salesperson as saying: “Almost all of them are back. Almost all of the people who were fired were the cause of this misconduct.”

The report states: “Even after the settlement with the SEC, pressure to meet quotas forced salespeople to crowd the sales channels with distributors by making ‘partial deliveries’ or delivering defective products at the end of the quarter, according to our interviews with former employees and customers.”

“Overall, we believe Super Micro is a serial repeat offender,” Hindenburg said in his report.

“The company has benefited from its pioneering role, but still faces significant accounting, governance and compliance issues and offers inferior products and services that are now being crowded out by more credible competition.”

Click here for the latest stock market news and detailed analysis, including events that move stocks

Read the latest financial and business news from Yahoo Finance