NEW YORK--(BUSINESS WIRE)--Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Green Dot Corporation ("Green Dot" or the "Company") (NYSE:GDOT) of the February 18, 2020 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you invested in Green Dot stock or options between May 9, 2018 and November 7, 2019 and would like to discuss your legal rights, click here: www.faruqilaw.com/GDOT. There is no cost or obligation to you.
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The lawsuit has been filed in the U.S. District Court for the Central District of California on behalf of all those who purchased Green Dot securities between May 9, 2018 and November 7, 2019 (the "Class Period"). The case, Esteban Koffsmon v. Green Dot Corporation et al, No. 19-cv-10701 was filed on December 18, 2019, and has been assigned to Dean D. Pregerson.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (1) Green Dot’s strategy to attract "high-value" long-term customers was at the expense of "one and done" customers; (2) Green Dot’s "one and done" customers represented a significant source of revenues in its legacy segment; (3) consequently, Green Dot’s strategy was self-sabotaging; and (4) as a result of the foregoing, Defendants’ statements about its business and operations were materially false and misleading at all relevant times.
On February 20, 2019, Green Dot CEO Steven W. Streit revealed during the FY 2018 conference call that the Company’s strategy of attracting "high-value" long-term customers at the expense of "one and done" customers was self-sabotaging, stating, "…that we are somewhat a victim of our own success in converting more and more of our quarterly active accounts to direct deposit active accounts." These "one and done" customers represented a significant source of revenue in the Company’s legacy segment.
On this news, Green Dot's share price fell from $74.67 per share on February 20, 2019 to a closing price of $67.20 on February 21, 2019: a $7.47 or a 10.00% drop.
Then, on May 8, 2019, the Company disclosed a large "investment in growth for the purpose of aggressively marketing new products."
On this news, Green Dot's share price fell from $63.27 per share on May 8, 2019 to a closing price of $46.56 on May 9, 2019: a $16.71 or a 26.41% drop.
Then, on August 7, 2019, Green Dot reported an "accelerated loss of unit sales in [its] prepaid product lines, resulting in lower active accounts from both non-reloading customers and cash reloading customers.
On this news, Green Dot's share price fell from $47.26 per share on August 7, 2019 to a closing price of $27.42 on August 8, 2019: a $19.84 or a 41.98% drop.
Finally, on November 7, 2019, the Company revealed a decline of 620,000 accounts in its active consumer business, mostly "one-time use accounts."
On this news, Green Dot's share price fell from $29.95 per share on November 7, 2019 to a closing price of $24.54 on November 8, 2019: a $5.41 or a 18.06% drop.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Green Dot's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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