heaps of public companies turn out to be frauds, there is an entire industry out there of people spotting fraudulent stocks and shorting them (see Muddy Waters,

heaps of public companies turn out to be frauds, there is an entire industry out there of people spotting fraudulent stocks and shorting them (see Muddy Waters, Citron research et al) Sino-Forest has probably been the largest and most well known (as well as Valeant and their fake pharmacies) along with a bunch of Chinese small-medium-cap reverse IPO's like CCME