Spruce Point Capital Management has gone short Leidos Holdings’ stock, alleging that the company misled investors regarding its recent $1 billion acquisition, as well as numerous product defects.

Leidos is an American defense, aviation, information technology, and biomedical research company.

In the Tuesday report, the short seller said it believes that none of Leidos’ claims of financial benefit from its acquisition of Security Detection & Automation are possible. Spruce Point explained that following interviews with experts, evaluating foreign financial filings, and dissecting management’s claims, the short seller was unable to reconcile at least $100 million of total international sales and between $335-$367 million of claimed international sales.

Spruce Point also allegedly found unusual transactions with a Thai distributor that has been linked to a graft scandal that led to the imprisonment of a Thai transportation minister.

To remedy these “abysmal due diligence failures,” Spruce Point called for the termination of the CEO, chief financial officer, and chief accounting officer.

Spruce Point did not end with its criticism of CEO Roger Krone. According to the short seller, Leidos has been concealing numerous product defects from investors, including faulty explosion detection systems at airports, ports, and borders, while Krone has been at the head.

The short seller claimed that Leidos is deflecting growing competitive threats from Amazon and Microsoft and has failed to acknowledge any risk to its business of an increasingly competitive environment for hiring technology talent.

Spruce Point put a 35%-60% downside risk on the company’s stock, with unquantifiable tail-risk to zero.

Leidos shares fell around 3% upon publication of the report, trading at $104.83 at 12:21 p.m. EST.

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