SAN FRANCISCO, June 6, 2016 /PRNewswire-USNewswire/ -- Shareholder and consumer rights law firm Schubert Jonckheer & Kolbe LLP has launched an investigation into whether certain officers and directors of LendingClub Corporation (NYSE: LC) breached their fiduciary duties to the company and its shareholders by failing to implement adequate internal controls over financial reporting and disclosure procedures.
The investigation concerns the abrupt resignation of former Chairman and Chief Executive Officer Renaud Laplanche on May 9, 2016, and the truth revealed in the aftermath of his resignation. Following Laplanche's resignation, the company announced that (1) it sold loans to an institutional investor that did not meet that investor's standards, a violation of the company's purported internal controls, and (2) the company had invested in Cirrix Capital LP, an entity that purchased loans on the LC platform in direct contradiction of the Company's representations that it did not assume credit risk in loans facilitated by its marketplace. The following day Goldmann Sachs Group Inc. and Jeffries LLC stopped buying loans on the platform, potentially jeopardizing future securitization deals for the company.
Following these announcements, LC shares plummeted, dropping more than 50% in one week and losing over $1.3 billion in market value. The stock now trades at less than 25% of its IPO price.
In filings made with the U.S. Securities and Exchange Commission (the "SEC"), the Company admits that it suffered "material weaknesses in internal control over financial reporting" and that its "disclosure procedures were not effective, and were not operating at a reasonable assurance level as of December 31, 2015." The company is now the subject of class action litigation and governmental and regulatory investigations arising from the matter.
Concerned shareholders who would like more information about their rights and potential remedies should contact Kathryn Schubert via email at kschubert@schubertlawfirm or by telephone at (415) 788-4220, or fill out the form on our website at http://classactionlawyers.com/LC.
About Schubert Jonckheer & Kolbe
Schubert Jonckheer & Kolbe has extensive experience in prosecuting securities claims and has successfully represented investors throughout the nation in shareholder lawsuits. Attorney advertising. Prior results do not guarantee similar outcomes.
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SOURCE Schubert Jonckheer & Kolbe LLP