San Francisco, California--(Newsfile Corp. - February 23, 2021) - Hagens Berman urges Ebix, Inc. (NASDAQ: EBIX) investors with significant losses to submit your losses now. A securities fraud class action has been filed and certain investors may have valuable claims.
Ebix, Inc. (EBIX) Securities Fraud Class Action:
The complaint alleges that, throughout the Class Period, Defendants misrepresented and concealed that: (1) there was insufficient audit evidence to determine the business purpose of certain significant unusual transactions in Ebix's gift card business in India during 4Q 2020; (2) there was a material weakness in Company's internal controls over the gift or prepaid revenue transaction cycle; and (3) the Company's independent auditor, RSM, was reasonably likely to resign over disagreements with Ebix regarding $30 million that had been transferred into a commingled trust account of Ebix's outside legal counsel.
Investors allegedly began to learn the truth on Feb. 19, 2021 when RSM abruptly resigned, stating that "despite repeated inquiries" RSM was unable to obtain sufficient audit evidence to "evaluate the business purpose of significant unusual transactions that occurred in the fourth quarter of 2020, including whether such transactions have been properly accounted for and disclosed in the financial statements subject to the Audit." These "unusual transactions" concerned the Company's gift card business in India.
In addition, RSM and Ebix reportedly disagreed over whether $30 million transferred to a comingled trust account of Ebix's outside counsel should still be classified as cash on Ebix's balance sheet, even though those funds were outside Ebix's direct control.
On this news, the Company's share price fell as much as $20.24, or 40%, in a single trading day.
"We're focused on investors' losses and proving Ebix insiders cooked the Company's books," said Reed Kathrein, the Hagens Berman partner leading the investigation.
If you invested in Ebix shares and have significant losses, or have knowledge that may assist the firm's investigation, click here to discuss your legal rights with Hagens Berman.
Whistleblowers: Persons with non-public information regarding Ebix 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 EBIX@hbsslaw.com.
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