Remember Pan Sutong? He’s the entrepreneur who lost $21 billion over two days when bad news at Hanergy Thin Film Solar Group sent the shares of his Hong Kong companies and the entire Hong Kong market tumbling. Pan was pretty sanguine about the losses yesterday, but he might change his mind today.

It appears that just days before the crash Hanergy Chairman Li Hejun shorted the stock of the company he founded and managed. Investors short a stock when they think the price is going to fall.

On Wednesday, Hanergy shares plunged 47%, eliminating $19 billion in market value before trading was halted. The company hasn’t released any comment on the trigger for the move.

“Li bought 26.4 million Hanergy additional shares at an average of HK$7.28 each on May 18, according to two separate filings to Hong Kong Exchange on Friday. He also increased his short position to 7.71% of Hanergy’s issued share capital from 5.81% on the same day,” Bloomberg reported. “The company hasn’t released any comment on the trigger for the move, and the filings didn’t explain Li’s position in the stock.”

Professional short sellers have been betting against the stock as it rocketed 500% over the past year to a valuation of HK$300 billion ($39 billion), valuing it at more than Sony. Rumors of manipulation had begun to rise.

But just as the professional shorts were giving up on the trade, as of May 18, they held only 3.1% of the outstanding shares, Li added to his short position.  Li, the biggest shareholder of the Hong Kong-listed solar-equipment maker, has never explained why he was shorting the stock, said Bloomberg.

Well, let’s play Capt. Obvious for a second. Li shorted the stock, because like all shorts, he expected it to fall. But, unlike most shorts, he had the power to make it happen.

Asia Unhedged, however, is no cynic. It always ascribes the highest possible motives to human behavior.

Is something a bit fishy floating in the water off Victoria Harbor? Of course not!

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