Lasertec Corp (TYO:6920), the crown jewel of Japan's stock market, is facing a firestorm of accusations after a short seller named Scorpion Capital released a scathing report labeling it a "ticking time bomb" built on a foundation of fraud.

The report, published on an unnamed platform (X), alleges Lasertec to be orchestrating a massive accounting scheme, resulting in inflated revenue, margins, and earnings. Scorpion Capital claims this fraud could be the biggest in Japanese history, reaching a staggering $23 billion.

Here's a breakdown of the accusations Scorpion Capital throws at Lasertec:

• Fake Numbers: The report alleges Lasertec is cooking the books, employing a textbook accounting scheme to fabricate financial success.
• Flawed Flagship: The star of Lasertec's show, the ACTIS EUV inspection machine, is allegedly riddled with problems, including a faulty light source, all kept secret from unsuspecting investors.
• Inventory Charade: The report raises a red flag about Lasertec's unusually high inventory levels, suggesting it could be a byproduct of their fraudulent accounting.
• A Hoax, Not Hope: Lasertec's announcement of their next-generation machine, the ACTIS A300, is dismissed as a mere hoax, designed to distract from the current A150's shortcomings.
• Empty Innovation? Scorpion Capital questions Lasertec's commitment to research and development. Investigators reportedly visited their new Innovation Park and found it deserted, lacking any signs of real activity. This raises doubts about the company's claims of innovation.

It's important to remember that these are accusations from a short seller who profits if Lasertec's stock price falls. Lasertec has yet to respond to these allegations. As with any such situation, a healthy dose of skepticism is warranted until a clearer picture emerges. We'll continue to follow this story for further developments.