A panel of independent directors of the Sino-Forest Corporation rejected claims of fraud at the Chinese company in a report released on Tuesday. But the redacted 111-page document also makes clear that the panel was unable to verify much of the company data and statements at the heart of the case.

Sino-Forest, whose shares have been halted on the Toronto Stock Exchange, is the subject of investigations by the Royal Canadian Mounted Police and the Ontario Securities Commission.

Its regulatory troubles began with an extensive and highly negative report by Carson Block, a short-seller with Muddy Waters Research, who called the company a “pump and dump” scheme that had been “aggressively committing fraud.”

The special committee of independent directors, however, flatly rejected Mr. Block’s assertions.

“I am pleased that the independent committee has been able to refute the substance of the allegations made in the Muddy Waters report.” Judson Martin, vice chairman and chief executive of Sino-Forest, said in a statement. “We can categorically say Sino-Forest is not the ‘near total fraud’ and ‘Ponzi scheme’ as alleged by Muddy Waters.”

Mr. Brock, however, did not agree with the committee’s conclusion.

“It should be noted that all three directors who oversaw the investigation are defendants in shareholder lawsuits, and one of the three resigned just prior to this release,” he said in a statement. “We believe this release has no credibility.”

Before the fraud claims, Sino-Forest had become one of the largest resource companies on the Toronto exchange, with a market capitalization of roughly $6 billion at one point. While Mr. Block and others have raised several questions about Sino-Forest, their central claims are that the company has greatly overstated its revenue and its timber holdings in China.

In their report, the directors said they were able to confirm the vast majority of Sino-Forest’s claimed timber holdings as well as the company’s valuation of those properties.

But they also noted that the majority of the company’s assertions were based on informal agreements with government-owned forestry agencies rather than legal ownership. The company is also structured through a complex network of offshore holding companies and relies on the use of third-party companies to act as middlemen.

“Forestry bureau confirmations are not officially recognized documents and are not issued pursuant to a legislative mandate,” the report states. “It appears they were issued at the request of the company or its suppliers.”

The directors noted that meetings with forestry bureau staff members failed to give the panel “significant insight into the internal authorization or diligence processes undertaken by the forestry bureaus in issuing confirmations.” The panel added that companies related to Sino-Forest apparently provided “benefits” to some forestry officials, although the directors did not quantify them and said they were unable to explain their purpose.

The report also indicates that the unusual corporate structure of Sino-Forest, along with irregular activities like the regular deletion of computer files and the use of personal e-mail accounts for corporate business, complicated the assessment of its financial records.

Sino-Forest currently runs much of its business through 58 holding companies incorporated in the British Virgin Islands, a tax haven; company names include Glory Billionaire International, Trillion Edge Limited and Ace Supreme. The directors concluded that the arrangements, while unusual by Western standards, were an accepted way of doing business in China.

“The use of such special purpose companies, one for each investment, also facilitates raising capital offshore and restructuring such companies without the uncertainties and delays inherent in the domestic Chinese system,” the panel said.

While the panel similarly cleared Sino-Forest’s reliance on third-party companies — what it called “authorized intermediates” to transact much of its business — its investigation of those firms encountered severe limitations. In most meetings between the agent companies and the panel’s investigators, the report said “no financial records were given, no copies of documents presented could be taken and the interviewees were not prepared to discuss any aspect of any other companies that deal with S.F. that they control.”

In an e-mail, Mr. Block said those and other limitations undermined the committee’s broad conclusions.

“As the report itself states, there was a lack of cooperation with the committee among related parties, and many of the documents were not independently verified and some were in fact copies of original documents,” he wrote. “It’s also interesting to note that Allan Chan, the former C.E.O. of the company, was directly involved in helping with the investigation.”

Some Sino-Forest investors, however, said the report cleared the company.

“This is the beginning of some very good news for us,” Simon Murray, chairman of Glencore International and an independent Sino-Forest director, told Reuters. “I never doubted it, but it has been very hard work to prove it given the sort of work involved in the forestry commission, the farmers, the land owners and everybody else.”

In addition to releasing its report, Sino-Forest’s board said that because it still needed to verity the company’s dealings with some suppliers and agents, it would delay the release of third-quarter results for up to 30 days.