What Should Netcapital Inc. Investors Know After 28.62% Stock Drop? The Law Offices of Frank R. Cruz Outlines Securities Fraud Class Action Lead Plaintiff Deadline

Lawsuit alleges Netcapital Inc. made misleading statements to investors from December 15, 2021 to September 3, 2026; lead plaintiff motions are due December 7, 2026

LOS ANGELES, Oct. 22, 2026 /PRNewswire/ -- The Law Offices of Frank R. Cruz today announced a class action lawsuit against Netcapital Inc. ("Netcapital" or the "Company") (NASDAQ: NCPL) on behalf of investors who acquired the Company's securities from December 15, 2021 to September 3, 2026. Filed on October 8, 2026, the case is Chance v. Netcapital Inc. et al., U.S. District Court District of Massachusetts, Case No. 1:26-cv-14584.

If you lost money on Netcapital Inc. securities, submit your Netcapital Inc. loss information by December 7, 2026 to learn about participating in the lawsuit.

Netcapital Inc. class action timeline

• Class period begins: December 15, 2021
• Class period ends: September 3, 2026
• Complaint filed: October 8, 2026
• Lead plaintiff motion deadline: December 7, 2026

What happened?

On August 10, 2026, the SEC filed a complaint against Netcapital and certain senior executives alleging, among other things, that Netcapital was involved in a fraudulent scheme to overstate the revenue of Netcapital. Specifically, from approximately October 2021 through January 2024, Netcapital improperly recorded nearly $14 million in revenue from sham consulting agreements which produced no real revenue for Netcapital. The recognition of this revenue inflated Netcapital's total revenue by approximately 345%. During this period, investors in Netcapital's public and private securities offerings invested over $25.6 million.

On this news, Netcapital stock fell $0.05 or 12.82%, to close at $0.35 on August 11, 2026, thereby injuring investors.

Then on August 17, 2026, the Netcapital disclosed that its independent registered public accounting firm, Fruci & Associates II, PLLC, had resigned.

On this news, Netcapital stock fell $0.09 or 28.62%, to close at $0.23 on August 18, 2026, thereby further injuring investors.

Finally on September 3, 2026, after market close, Netcapital disclosed that on Avi Liss had resigned as a member of the Board of Directors, and from all committees of the Board, including the Audit Committee, effective immediately. In his resignation letter, Liss stated that he was resigning "in light of the serious allegations recently asserted against the Company and certain current and former officers, directors, and other individuals" in the SEC Complaint.

On this news, Netcapital stock fell $0.05 per share, or 8.15%, to close at $0.58 per share on September 4, 2026. The following trading day, Netcapital stock fell a further $0.08 per share, or 13.15%, to close at $0.50 per share on September 8, 2026, thereby further injuring investors.

What is the Netcapital Inc. lawsuit about?

The Netcapital Inc. securities lawsuit alleges that, between December 15, 2021 and September 3, 2026, defendants made materially false and/or misleading statements and failed to disclose material adverse facts about Netcapital Inc.'s business, operations, and prospects. Specifically, the complaint alleges defendants failed to disclose that: (1) Over the Class Period, Netcapital improperly recognized material revenues from what were, in reality, sham consulting agreements with entities controlled by Defendant John Fanning; (2) The consulting agreements were backdated and in some cases forged, and Netcapital Advisors provided little if any meaningful consulting services; (3) The Portfolio Company transactions were improperly undisclosed related-party transactions involving John Fanning; (4) Netcapital's certifications pursuant to the Sarbanes-Oxley Act of 2002 were false; and (5) as a result, defendants' positive statements about Netcapital Inc.'s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

"According to the complaint filed against Netcapital Inc., the Company, among other things, did not disclose that Over the Class Period, Netcapital improperly recognized material revenues from what were, in reality, sham consulting agreements with entities controlled by Defendant John Fanning. The December 7, 2026 deadline is a key date for Netcapital Inc. investors who want a voice in how this case moves forward," said Frank R. Cruz of The Law Offices of Frank R. Cruz.

What should Netcapital Inc. investors do now?

The Law Offices of Frank R. Cruz can help Netcapital Inc. investors evaluate potential claims to recover their losses.

Investors who want to serve as lead plaintiff in the Netcapital Inc. class action must file a motion with the Court by December 7, 2026. For more information, visit the Netcapital Inc. case page, email [email protected], or call 310-914-5007.

If you inquire by email, please include your mailing address, telephone number, and number of shares purchased.

Investors may retain counsel of their choice. Netcapital Inc. investors who bought during the class period may also take no action and remain absent class members. No class has been certified yet in the Netcapital Inc. case.

Questions and answers about the Netcapital Inc. lawsuit

Who is eligible? Investors who bought Netcapital Inc. securities between December 15, 2021 and September 3, 2026 and lost money may be class members, and may seek lead plaintiff appointment by December 7, 2026.

What does a lead plaintiff do? The lead plaintiff is appointed by the court to represent all class members and direct the Netcapital Inc. class action.

Must I be lead plaintiff to share in a recovery? No, Netcapital Inc. investors can take no action and remain absent class members.

How are attorneys' fees handled? The Law Offices of Frank R. Cruz works on contingency, so investors pay no attorneys' fees unless there is a recovery, and any fees require court approval.

About The Law Offices of Frank R. Cruz

The Law Offices of Frank R. Cruz investigates and prosecutes securities fraud and corporate malfeasance class actions. With nearly 20 years of litigation experience, the firm focuses on complex securities class actions and gives each client personal, one-on-one attention throughout the legal process.

Prior results do not guarantee a similar outcome.

Related links

• Netcapital Inc. case page, The Law Offices of Frank R. Cruz
• Complaint: Chance v. Netcapital Inc. et al., U.S. District Court District of Massachusetts
• Form 8-K
• Netcapital Inc. SEC filings index, EDGAR
• The Law Offices of Frank R. Cruz

Follow The Law Offices of Frank R. Cruz for updates on Twitter: twitter.com/FRC_LAW

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SOURCE The Law Offices of Frank R. Cruz, Los Angeles