NEW YORK, May 18, 2016 /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of Gerdau S. A. ("Gerdau" or the "Company") (NYSE: GGB). Such investors are advised to contact Robert S. Willoughby at email@example.com or 888-476-6529, ext. 9980.
The investigation concerns whether Gerdau and certain of its officers and/or directors have violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
On or around March 26, 2015, news reports revealed that the Company was the subject of a raid by Brazilian Federal Police in connection with "Operation Zelotes," an investigation into alleged tax fraud by a variety of Brazilian companies. According to news reports, Gerdau allegedly defrauded tax authorities of over $380 million, including by engaging in a bribery scheme with tax authorities. On this news the Company's American Depository Receipts ("ADRs") fell $0.38 per share, or over 11%, to close on March 27, 2015 at $3.06 per share on unusually heavy volume. On or around February 23 through February 26, 2016, Gerdau's offices were the subject of further raids by Brazilian authorities in connection with Operation Zelotes. According to Brazilian authorities Gerdau was targeted in a new phase of an investigation involving bribes to the Board of Tax Appeals, and police carried out "20 court orders for testimonies and 18 search warrants in Rio Grande do Sul, Rio de Janeiro, Sao Paulo, Pernambuco and Brasilia." On February 25, 2016, Gerdau confirmed that Brazilian police had raided Company offices in connection with Operation Zelotes. On this news the Company's ADRs fell $0.19, or nearly 18%, over four trading days, to close at $0.87 per share on February 26, 2016. On May 16, 2016, various news outlets reported that Brazil's federal police accused Gerdau of evading $429 million in taxes and indicted Gerdau executives, including Chief Executive Officer André Gerdau Johannpeter, on corruption-related charges. The charges included bribery, money laundering, and influence peddling.
On this news, Gerdau's ADRs fell $0.13, or over 7%, to close at $1.72 per share on May 16, 2016.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and Los Angeles, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com
Robert S. Willoughby
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SOURCE Pomerantz LLP