January 20, 2021 - An investor in shares of 9F Inc. (NASDAQ: JFU) filed a lawsuit in the U.S. District Court for the District of New Jersey over alleged violations of Federal Securities Laws by 9F Inc. in connection with certain allegedly false and misleading statements made between August 14, 2019 and September 29, 2020.
China based 9F Inc., together with its subsidiaries, operates a digital financial account platform that integrates and personalizes financial services in the People's Republic of China.
On or about August 15, 2019, 9F Inc. sold about 8.9 million NASDAQ: JFU shares in its initial public stock offering (the IPO ), at $9.50 a share raising nearly $85 million in new capital. 9F Inc. reported that its annual Total Revenue declined from over 5.55 billion CNY in 2018 to over 4.42 billion CNY in 2019, and that its Net Income of over 1.98 billion CNY in 2018 turned into a Net Loss of over 2.15 billion CNY in 2019. Shares of 9F Inc. (NASDAQ: JFU) declined to as low as $1.76 per share on July 24, 2020.
According to the complaint the plaintiff alleges on behalf of purchasers of 9F Inc. (NASDAQ: JFU) common shares between August 14, 2019 and September 29, 2020 , that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that the materials supporting the IPO, and defendants throughout between August 14, 2019 and September 29, 2020, made false and/or misleading statements and/or failed to disclose that the purported value and benefits of the Company’s financial institution partners and its tri-party cooperation business model did not in fact exist and/or were materially overstated, given that 9F and Property and Casualty Company Limited (“PICC”) had been engaged in an ongoing contractual dispute regarding payment of service fees under the Cooperation Agreement, that the collectability of service fees owed to 9F by PICC under the Cooperation Agreement was in doubt and at serious risk of non-payment, that there was a significant risk that PICC would no longer provide credit insurance and guarantee protection to investors and institutional funding partners, that as a result of the foregoing, the Company’s platform, business model, reputation and financial results had been materially impaired, and that as a result, defendants’ statements about the Company’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times.