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Plagiarism by Goldman Sachs Analyst

Plagiarism by Goldman Sachs Analyst

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An anonymous whistle-blower calls out Julian Zhu, the head of Goldman Sach's China commodities research team, for plagiarizing his research from several China-based research firms.
An anonymous whistle-blower calls out Julian Zhu, the head of Goldman Sach's China commodities research team, for plagiarizing his research from several China-based research firms.

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Published by: uucp2 on Jan 21, 2013
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05/23/2013

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From: cleanwaters Sent: Monday, January 21, 2013 5:47 AM To: jinchul.lee@sigmacapny.com; andrew.bazarian@sac.com; pan.hui@sac.

com; ran.zhou@sac.com; yeeman.chin@sac.com; ricky.liew@sac.com; xuan.liu@sac.com; joohan.lua@sac.com; jixin.dai@soros.com; robert.tsai@soros.com; leo.li@soros.com; maurien.yau@schroders.com; chalit.masoodi@schroders.com; karen.lin@schroders.com; robert.davy@schroders.com; matthew.dobbs@schroders.com; amelia.wong@schroders.com; laura.luo@schroders.com; Toby.Hudson@schroders.com; christopher_yip@troweprice.com; mark_edwards@troweprice.com; jzhang1@templeton.com; patrick.lee@clamc.com.hk; janice.tan@clamc.com.hk; cliu1@templeton.com; jwong3@templeton.com; Chow, Leslie; Shi, Bin; Devine, Joseph ; Ramesh.Karthigesu@ubs.com; jcotoole@wellington.com; fdcatrickes@wellington.com; bzmeunier@wellington.com Subject: Plagiarism by Goldman Sachs Analyst

Dear investor, Happy New Year! This is to showcase how a Goldman Sachs Research Analyst based in Hong Kong plagiarised research reports written by small Chinese mainland brokers. This analyst (Julian Zhu) was trying to fool overseas investors who clearly wouldn't read or check these C hinese r eports. He has been plagiarizing at least since 2010. Below is our evidence: (1) In the attached "GS Dec 2011 report", Exhibit 105: Assets to be injected (Page 73), is IDENTICAL TO Exhibit 6 on Page 8 of a Oct 25, 2011 report written by Founder Securities (attachment: "Founder Securities China Coal Report Oct 2011"). Why is it plagiarism? First,

we checked with China Coal and they told us the reserve number of China Coal Import and Export Company was NOT 70 million tonnes but should be around 700 million. Clearly, Founder Securities got this number wrong in October 2010 (likely a typo). And the Goldman a nalyst j ust copied the wrong number as is 2 months later. So where is the due diligence which should be the basis of sell side research report? Buy side clients are paying millions of dollars to Goldman Sachs just to read a table hand-made by an unknown Chinese broker! (2) In the attached "GS Dec 2010 report", Exhibit 139: Jiangxi Copper mine expansion schedule (Page 72), is plagiarized from Table 9 on Page 24 of a report written by Orient Securities on Sep 27, 2011. Look at the column of "Expansion plan", they were exactly copied from the Orient Securities report. Orient Securities had no input for "Dongxiang Copper Mine" in September, so did the Goldman report in December. Coincidence? We don't think so. We checked Jiangxi Copper's record of analyst visi ts in 20 10 and found NO RECORD of Julian Zhu's visit or meeting with management, which should be part of the due diligence. Again, buy side clients are paying Goldman Sachs just to read second-hand information from an unknown Chinese broker. Without sufficient due diligence, how sound will a research analyst's recommendation be? Julian Zhu assigned both BUY ratings for China Coal and Jiangxi Copper in the above 2 reports. Jiangxi Copper was even on Goldman's regional conviction list. Let's see what happened to the stock prices after his investment recommendation:

- Julian Zhu assigned a 12-month target price for Jiangxi Copper of HKD35.2 on December 3, 2010. He asked investors to buy the stock for 56% upside in 12 month. In reality, the stock price dropped by 23% in 12 months. - Julian Zhu assigned a 12-month target price for China Coal of HKD11 on December 13, 2011. He asked investors to buy the stock for 21% upside in 12 month. In reality, the stock price dropped by 17% in 12 months. Buyside clients are paying GS millions of bucks each year just to see their plagiarized reports from some unknown Chinese brokers? We urge you to take legal actions against Julian Zhu and Goldman Sachs for their material misleading in stock research reports without adequate basis and lack of due diligence. Thanks for your attention and happy trading. Best regards, Whistleblower

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