This is the transcript between MW and CCME salesgirl. Some of MW translations were inaccurate, so I put MW's translation in () under my translation. Other wise, just copied MW translations.
I also added some comments in between. Hope this will help investors to understand what MW did.
Admission of Securities Fraud
Comment: where ? I could not find anything in this conversation indicating fraud of CCME.
I. Because our analyst wasn't expecting the call, he was unable to record the first approximate two minutes.
II. The call resulted from Muddy Water's letter to Deloitte dated February 23, 2011
III. The voice of our analyst has been disguised.
Analyst: How do you want to me to talk with my manger?
(MW: You want to talk to my manager?)
CCME Rep: If you can, can you just tell him that the quoted proposal just contains bus number from selected high quality bus lines.
(MW: If you can, can you just tell him that the quoted proposal is for particular bus lines?)
Comment: After finishing reading whole conversation, you will understand the "proposal" refers to the bus spreadsheet she gave to MW.
Analyst: Talk to my manager? But the manager who worked on this project and I are no longer working for the company. Does it still make sense to talk with him?
CCME rep: Oh, he also left his company?
Analyst: Yes, I could call him, but... Sorry, I want to help you - I don't want to cause you any trouble. So Could you please explain the situation to me ?
CCME Rep: The situation is just what I've told you. Say for example we have 1,000 vehicles, 1,000 is the number we quote to outsider.
But I have only quoted 500 vehicles to you, because these 500 vehicles are already signed with contracts and installed with CCME devices.
The other 500 vehicles don't have devices installed, so the number I quoted to you is the actual number of vehicles with CCME devices.
It is like this. The number I quoted to you is the actual number of vehicles with CCME devices, but when we make proposal, we are based on 1,000 vehicles.
(MW: but our company has asked us to claim based on 1,000 vehicles)
Comment: She was trying to cover her fabricated spreadsheet. However, MW put "our company has asked us to claim based on 1,000 vehicles" to her mouth.
Analyst: Ok, I see, but what's the relationship to your quoted price?
Comment: MW tried to misguide her to talk about rate sheet. However, rate sheet does not have any problem. She only worried about her fabricated spreadsheet.
CCME Rep: There are some conflicts, For example...
Analyst: You've told me at the time that the base number is 1,000 vehicles to start - that's to say 1,000 is the base number.
It doesn't matter if you need 500 vehicles, or 1,000 vehicles, or 100 vehicles.
They're all based on the base number of 1,000. What's that have to do with whether the devices are installed or not ?
CCME Rep: When we reported to the details to the stock market regulator, we didn't report the number of vehicles we quoted you. The number we reported is multipled by two, or doubled. Do you understand now ?
Analyst: What's the relationship between the number of vehicles you quoted me and the stock market regulator? I am confused.
(MW: What's the relationship between the price you quoted me and the stock market regulator? I'm really confused.)
Comment: MW translated "number of vehicles" into "the price".
CCME Rep: You still don't understand, do you?
(MW: You don't understand, do you?)
Analyst: No, I don't understand. The proposal you provided to me isn't some confidential business information.
Comment: MW was playing innocent here.
What's the relationship between your proposal and stock market regulator?
CCME Rep: Because we're a public company, we must reach the number of vehicles, and we've only installed devices on some of the vehicles, and some vehicles aren't installed with devices.
The number of vehicles we've claimed to the public is the total number, but the number I (MW used "we" here) gave you is the vehicles installed with devices. So there are some conflicts.
Analyst: Ok, I see.
CCME Rep: What really happened is that the number I told you is the actual number, and not the number we've reported to the market regulator.
What we've reported to the market regulator is the number under contract. The number I've given you is contracted with devices installed.
Comments: Here she clearly stated that her spreadsheet was incomplete, only for buses with devices. Again she was lying here too. Her spreadsheet was just incomplete and with many errors.
Analyst: I see. And what do you want me to do to help you?
CCME Rep: There's nothing you can help me with right now.
Analyst: Does your company know it's you?
CCME Rep: I have one question. Have you told you colleagues I'm the person you contacted?
Analyst: No. I'm the only person communicating with you from my company. In my company, the person initially in charge of something is responsible until it finishes.
Analyst: When you wanted to meet met with my manager, he asked me to communicate with you and make sure everything is ok through the finish.
Therefore, I'd be your only contact at entire time.
CCME Rep: That's good. If there are people checking with you about me, then just tell them you don't know me.
Analyst: Do not worry. I will definitely do what you asked. Actually those who were working on this matter have already left the company with my boss.
(MW: Ok, and actually those who were working on this matter have already left the company with my boss.)
There are only two or three still staying in that company.
I'm not sure if they're the people who passed out the information. But they don't know you, and I've never mentioned you.
CCME Rep: I as so surprised. The auditors who came to investigate are so sharp. They have the exact same proposal I sent you before.
(MW: I as so surprised. The auditors who came to investigate are so sharp. They have the same proposal I sent you before).
Comments: MW did not translate the "exact".
Analyst: Have you given the same proposal to other customers?
CCME Rep: Yes, we do, oh, no, I did not say to other customers.
(MW: Yes, we do,)
Comments: MW was sneak here. He tried to get her to say the spreadsheet she gave to him is for all customers, which can be used as indirect proof of the legitimacy of the spreadsheet. But she rejected this.
Analyst: I mean, the proposal wasn't necessarily from you. Is it possible your colleague sent it out?
CCME Rep: Eh...I've definitely created that proposal. Because it is the proposal I made, and I can tell clearly.
(MW: Eh...I'm quite sure this proposal is mine because I know the proposal I made, and I can tell clearly)
Comments: She told MW she created (fabricated) the proposal (bus info spreadsheet).
CCME Rep: I'm afraid that the auditors might know some people from your company. They're very good. They'll keep on asking question until they get to the point.
Comment: Deloitte did very through investigation. But, looking for fabricated spreadsheet should not be the jobs of Deloitte.
Analyst: So you've been audited by the auditing firm?
CCME Rep: Yes, but of course I didn't admit that I did this proposal. But what happened is very serious in my company. They're searching QQ.
I remember I've sent it to you on QQ. I'm in trouble.
Analyst: Delete it from your QQ.
CCME Rep: But I'm home now. There shouldn't be anything on QQ because our hard drivers have been replaced at that time.
Analyst: You mean your company has replaced the hard drives?
CCME Rep: It is my computer's (hard drive)
(MW: My computer's)
Comment: again, MW tried to get her to say CCME changed the company hard driver, which could indicate CCME was hiding something. But she rejected such idea.
Analyst: Oh, I see. Then you'll be ok.
CCME Rep: The problem is that they may find it in the server.
CCME Rep: I feel so bad...
Analyst: I don't think they're able to investigate me, Are they able to find out who I am?
CCME Rep: I don't know. They might find your QQ, or they might talk with you. Just tell them you don't know whom you've been in contacted with.
Anyway, anything about China MediaExpress, please don't mention me.
Analyst: Ok, don't worry. I won't talk about you, and also I've left that company already.
CCME Rep: You say you've left that company, but you're still working for the old boss?
Analyst: Yes, but the company that was going to hire you doesn't exist anymore.
CCME Rep: You mean that the company doesn't exist anymore?
Analyst: No, the company still exists, but the people who used to work on this matter don't work there anymore.
So if the auditing firm finds the company, there's nobody there who knows what's going on. So you do not need to worry about.
(MW: So if the auditing firm finds the company, there's nobody there who knows what's going on.)
CCME Rep: Is it possible that any of your colleagues have passed on the proposal?
Analyst: All of them have this proposal because I sent it out to them before the meeting so they can prepare.
The chance of leakage from my sources is very slight.
CCME Rep: Maybe not possible, but maybe they found out from the managers who were at the meeting.
Analyst: I don't know. Maybe the computers in your company were hacked.
Comment: Shame on MW for lying to her!
CCME Rep: Really?
Analyst: I don't know, but anything's possible.
CCME Rep: It's lucky that I didn't leave my phone number on the proposal.
(MW: It's lucky that I didn't leave my number on the proposal.)
Analyst: If someone calls me asking about you, I'll definitely tell them I don't know. Don't worry, the chances are very low.
CCME Rep: Ok...
Analyst: If there's something you need help with, you can always call me.
CCME Rep: Thanks...
CCME Rep: Please tell the manager not to pass out this proposal to anyone else.
Analyst: Ok, ok.
Analyst: Ok, actually the proposal isn't useful to us now. Just as I told you yesterday - this matter won't move forward.
So don't worry, and I'll tell them to delete it. We don't help things that we're not using.
Comments: they made phone calls yesterday.
CCME Rep: How many people were at the meeting?
Analyst: Maybe seven or eight, and not all of us have this proposal. Each person on our team handles different things...
Some focused on Bus Online, some are in charge of China MEdiaExpress, and some are in charge of other media companies.
For example, my colleague got the proposal from Bus online. He’ll email it to me, and of course I'll email your proposal to him as well.
And our company isn't big; there are only a few who know about this. So you do not need to worry about.
Comments: She was still suspecting that MW's team gave out the spreadsheet, so she kept asking questions.
CCME Rep: Maybe the auditing firm was asking around and found your company.
Analyst: Most people in my company don't know about this. Even if the auditing company asks them, they'll have no idea.
The people who were working on this case have left that company, and I'll tell my colleagues and manager to keep quiet.
CCME Rep: Just tell them that this proposal contains only the buses from high quality bus lines.
(MW: Tell them that the vehicles we quoted before are all for particular lines. That is yet.)
Analyst: Ok, ok
CCME Rep: Well, thank you.
Analyst: You're welcome. If you need any help, just give me a call. Don't worry. It'll be OK.
CCME Rep: Ok, bye.