Hedge-fund firm Paulson & Co, the largest shareholder in Sino-Forest Corporation (TRE.TSE), has disposed of its entire stake in the company following reports that the Chinese tree-plantation owner overstated the value of its holdings, Bloomberg reported. In a regulatory filing, Paulson & Co reported selling 34.7 million shares in Sino-Forest. The Chinese company has seen its shares fall 85% since short-seller firm Muddy Waters released a report questioning its financial statements in early June. Sino-Forest’s shares fell a further 14% in trading in Toronto on Tuesday, after Canada’s Globe and Mail reported that “inconsistencies” had been found in the valuation of Sino-Forest’s holdings in China’s Yunnan province. A plantation where Sino-Forest bought timber rights in 2007 is smaller than the 200,000 hectares (494,000 acres) it claims, the Globe said. The newspaper cited Xie Hongting, chairman of Gengma Forestry, which sold land to Sino-Forest, and a provincial forestry official it declined to identify. However, Sino-Forest stands by the stated figure, claiming the Globe’s report is an “incorrect portrayal” of the company’s business, in a statement released on Monday.