SAN DIEGO & QINGDAO CITY, SHANGDONG PROVINCE, China--(BUSINESS WIRE)--Shareholder rights law firm Robbins LLP announces that a purchaser of SOS Limited (NYSE: SOS) American depository shares ("ADSs") filed a class action complaint against the Company and its officers and directors for alleged violations of the Securities Exchange Act of 1934 between July 22, 2020 and February 25, 2021. Formerly known as China Rapid Finance Limited, SOS previously focused on a peer-to-peer, micro-lending business. The Company changed its name to SOS Limited in July 2020 and rebranded itself as a technology company that purportedly provides marketing data, technology, and solutions for emergency rescue services. In January 2021, the Company again shifted its business focus, this time to cryptocurrency mining.
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SOS Limited (SOS) Misled Investors Regarding the True Nature of its Business
According to the complaint, critical to SOS's transition into cryptocurrency mining were the Company's claims to have entered into an agreement with HY International Group New York, Inc., which calls itself the "world's largest mining machine matchmaker," to acquire 15,645 mining rigs for $20 million, and the Company's plans to purchase FXK Technology Corporation, a purported cryptocurrency technology firm. In addition to changing business focus, the Company has changed the location of its headquarters five times since going public in April 2017.
On February 26, 2021, Hindenburg Research and Culper Research released commentary on SOS, claiming the Company was an intricate "pump and dump" scheme that used fake addresses and doctored photos of crypto mining rigs to create an illusion of success. The analysts noted that SOS's filings listed a hotel room as the Company's headquarters, asserted that the entity from which SOS purportedly bought the mining rigs appeared to be a fake shell company, and noted that the images from SOS's website depicting "miners" actually belonged to another company, among other things. On this news, SOS's ADS price fell $1.27 per share, or 21.03%, to close at $4.77 per ADS on February 26, 2021.
The complaint alleges that throughout the class period, defendants made false and/or misleading statements and/or failed to disclose that: (i) SOS had misrepresented the true nature, location and/or existence of at least one of the principal executive offices listed in its SEC filings; (ii) HY and FXK were undisclosed related parties and/or entities fabricated by the Company; (iii) the Company had misrepresented the type and/or existence of the mining rigs that it claimed to have purchased; and (iv) as a result, the Company's public statements were materially false and misleading.
If you purchased shares of SOS Limited (SOS) ADSs between July 22, 2020 and February 25, 2021, you have until June 1, 2021, to ask the court to appoint you lead plaintiff for the class.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
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