Things could get very interesting for Chimera Investment Corporation (CIM 0.51%) over the next two weeks.

In the middle of September, Chimera informed investors that it had received a "four-month extension for continued listing and trading of the Company's stock on the New York Stock Exchange." The mortgage REIT now has until Jan. 15 to file its 2011 annual report with the Securities and Exchange Commission. If it misses the deadline, according to a related filing, "the NYSE will move forward with the initiation of suspension and delisting procedures."

3 critical things to know about Chimera
For those of you not familiar with the controversy surrounding Chimera, there are three important things to note. First, the company hasn't published a single financial statement since the third quarter of 2011. In addition to its 2011 annual report, it's failed to file quarterly reports for the first, second, and third quarters of 2012.

Second, it's restating effectively every financial statement it's filed since going public in 2008 -- the only exceptions are the quarterly reports from the first and second quarters of 2008, when little to nothing of financial substance occurred. A preliminary estimate provided by the company is that the restated documents will decrease the company's net income by a staggering 66%, from $1.06 billion down to $367 million -- never mind the fact that it paid over $1 billion in dividends over this same time period.

And third, as I discussed here, in a recent press release Chimera acknowledged that it has begun returning capital to shareholders: "For the first three quarters of 2012, Chimera has paid cash dividends totaling $0.29 per common share. Of this amount, $0.06 is currently expected to be characterized as a return of capital for federal income tax purposes."

So, will Chimera be delisted?
Do all of these things mean Chimera's about to be delisted from the NYSE? Not necessarily. In fact, on the last day of 2012, the company filed a largely substance-less report with the SEC to fulfill other reporting requirements of the NYSE related to the independence of its board, etc. In addition, even if it doesn't miss the Jan. 15 deadline, it very well may get another extension.

That being said, the threat is real, as Chimera is one of only four companies on the NYSE to have failed to file both its 2011 annual report as well as all subsequent quarterly reports. Also making this unceremonious list is General Steel Holdings (GSIH), a Nevada-based holding company for various steel companies headquartered in China -- in case you missed the point, I encourage you to read up on the recent wave of fraudulent reverse mergers emanating out of the middle kingdom.

To add insult to injury, moreover, Chimera has gone on the record to warn investors of the possibility that it may indeed miss the Jan. 15 target, saying: "Although the Company is working diligently to complete the 2011 [annual report], no assurance can be given that [it] will be filed by January 15, 2013."

Do yourself a favor: avoid this stock
Quite frankly, whether or not Chimera makes the Jan. 15 deadline or misses it, or whether it's delisted from the NYSE or not, my recommendation is to avoid this stock altogether. If you're looking for exposure to the mortgage REIT space, you'd be much better served by the likes of American Capital Agency (AGNC 0.89%), ARMOUR Residential (ARR 0.86%), or Annaly Capital Management (NLY 0.96%) -- though I don't personally like any of them. Or if you're looking simply to speculate, save your money for the craps table -- at least you'll get free drinks.

As I've discussed on multiple occasions previously, including in our new in-depth report on Chimera, this company is bad news. Plain and simple. By its own admission, it committed highly suspicious (not to mention, material) accounting errors, practices nepotism to fill executive positions, and is potentially in the process of liquidating. If there is such a thing as toxic waste in the stock market, Chimera certainly fits the bill.