(Updated from Thursday. Adds detail from BDO Limited's resignation letter.)NEW YORK ( TheStreet) -- The auditor of China-Biotics ( CHBT) has resigned amid a series of explosive allegations that suggest the company's management may have committed acts of forgery in an elaborate scheme to report false financial results. A Shanghai-based maker of probiotic yogurt cultures, China-Biotics revealed the resignation in a disclosure filing with the Securities and Exchange Commission following the closing bell Thursday, making it the latest Chinese company to see its auditor flee after accountants uncovered evidence of potential fraud while examining financial numbers in preparation for an annual report. >>Bigtime Investors Lose Big on China In a resignation letter appended to China-Biotics' filing, BDO Limited, the Hong Kong-based affiliate of the global accounting firm BDO International, said the irregularities it discovered "likely constitute illegal acts." China-Biotics' U.S.-based representatives at the PR firm Grayling didn't immediately respond to requests for comment. Among other things, BDO said that its auditors, attempting to review online bank records, were directed by staff of China-Biotics to "access a suspected fake Web site" that supposedly belonged to the bank in question, called the Bank of Communications, where the company kept one of its major cash accounts. BDO also noted irregularities involving interest income and the "chops" that were included on a sales contract. "Chops" in China are used as a kind of seal to verify document authenticity. BDO Limited also said China-Biotics failed to take "appropriate remedial actions" when the firm's auditors approached management about the irregularities, making it "impossible for BDO Limited to gather evidence to assess whether the Company's accounting records have been falsified and whether there are other issues which could have a material effect on the financial statements of the Company." In the Thursday filing, China-Biotics said its chief financial officer, Travis Cai, also resigned. A replacement was named: Marie Yang, the "financial manager" of one of China-Biotics' subsidiaries. In her new role, she'll receive $3,000 a month, the company said. The company received a delisting notice from the Nasdaq Stock Market on Thursday evening. In a press release, China-Biotics said it will "use its best efforts to submit a plan of compliance" to the exchange by the deadline, July 5. China-Biotics has long been suspected by short-sellers and others of falsifying the information it files with the SEC -- and thus presenting to the American investing public an exaggerated picture of its business. The company, which went public in the U.S. through the controversial reverse-merger process in 2006, had vigorously defended itself against its accusers. It has become one of the most contentious long-short battleground stocks in a sector full of them. The company had even attracted interest from major U.S. institutional money, including the massive Boston-based fund advisor Wellington Management, which took an 8% stake in China-Biotics.