Shares of Chinese streaming company Joyy Inc (NASDAQ:YY) fell sharply following a new Muddy Waters report.

What Happened: A short report from Muddy Waters titled “You can't make this stuff up. Well…actually you can” accuses Joyy of having fraud live streaming services.

Muddy Waters said 90% of YY Live is fraudulent, according to a year-long investigation. The report said 50% of YY Live gift volume comes from bots.

“YY Live is an ecosystem of mirages," according to Muddy Waters. "Its supposedly high-earning performers in reality take home only a fraction of their reported totals.”

The company’s Bigo international streaming business is “barely more real,” according to Muddy Waters. The short report said Bigo’s Singapore parent changed auditors three times in four years.

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Badiu Acquisition: Muddy Waters questioned the acquisition of YY Live by Baidu Inc (NASDAQ:BIDU), which was rumored in October.

The acquisition by Baidu that costs $3.6 billion represents 7% of the company’s market capitalization.

“Baidu/YY Live will be THE test of whether China Inc. is really just a few bad apples; or, whether the incessant cheating, lying, and indifference to U.S. law permeate the highest echelons of China’s public companies," the Muddy Water report said.

Benzinga reached out to YY representatives for comment.

YY Price Action: Shares of Joyy are down 25% to $75.47 at publication time.