Kingold Jewelry (KGJI) Securities Fraud Class Action:
The complaint alleges that Defendants made false and misleading statements and concealed that Kingold used fake gold as collateral to fraudulently secure loans, increasing the likelihood the company would face creditor lawsuits and be delisted from the Shanghai Gold Exchange.
Investors allegedly began to learn the truth on June 29, 2020 when Caixin Global published an article accusing the company of using 83 tons of gold bars that were actually gilded copper as collateral for loans. This news drove the price of Kingold shares 24% lower that day.
Based on new developments, Hagens Berman is investigating whether to expand the class period. Specifically, on Aug. 20, 2020, Kingold announced its auditor Friedman LLP resigned effective immediately on Aug. 15, 2020. Friedman's resignation letter stated it became aware of information about Kingold's annual financial statements for the years ended Dec. 31, 2016 – Dec. 31, 2018 that it would have investigated had such information come to its attention during the course of the related audits. Friedman further stated "[t]he Company has not cooperated in attempting to substantiate this information" and "the client-auditor relationship between the Company and Friedman has ceased." This news sent the price of Kingold shares crashing lower again.
"We're focused on investor losses, proving Kingold and its senior management cooked the company's books, and whether to expand the alleged class period," said Reed Kathrein, the Hagens Berman partner leading the investigation.
Whistleblowers: Persons with non-public information regarding Kingold should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email [email protected].
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