Publicly available records indicate that a class action lawsuit has been filed on behalf of investors in PPDAI Group (NYSE:PPDF) in connection to alleged violations of securities laws by PPDF. Fitapelli Kurta is interested in speaking to investors who have complaints regarding investments made in PPDAI Group between February 8, 2017 and November 13, 2018.
The class action complaint specifically alleges that during the period in question, PPDF might have provided false and/or misleading material information, and/or failed to disclose adverse material information in connection with its Initial Public Offering in November 2017, namely: that the company was participating in predatory lending activities in which they gave debts with high interest rates to subprime borrowers and others with poor or limited credit histories who would be unable to repay the debts; that many of the company’s customers were taking out loans to repay other loans, consequently inflating the company’s revenues as well as its active borrower statistics, in turn raising the potential for defaults; that the company’s reserves were being negatively impacted by rising rates of delinquency; that what the company represented as “rapid growth” in the quantity and size of its loans had tapered off; that the company was giving college students online loans even though the government had banned doing such; that the company was participating in improper and aggressive practices when it came to collecting debts; and that as a result of its improper practices, the company faced an increased risk of negative actions by regulatory authorities in China. The complaint alleges that when true facts emerged, investors suffered losses.
According to the company’s website, PPDAI Group is a web-based consumer finance marketplace based in China. It was launched in 2007 and is also known as Paipaidai. Per the company’s description, it boasted more than 78 “cumulative registered users” as of June 30, 2018. Its focus is on borrowers aged 20 to 40, which it states is “a demographic typically more receptive to internet financial services and poised to become the driving force of China’s consumer finance market.” Its borrowers live in “97% of the cities and counties in China,” according to the company, and many have “limited or no credit history.” It chiefly offers customers short-term loans “to meet their immediate credit needs” while building credit history over time. The company trades on the New York Stock Exchange under the symbol PPDF.