A California financial technology company is threatening to take legal action against an investment research firm after allegations of financial misconduct sent its stock price tumbling on Tuesday.
SoFi Technologies announced it may pursue legal remedies against Muddy Waters Research following the publication of a report that the lending company characterized as “factually inaccurate and misleading.”
The investment research firm disclosed it had taken a short position against SoFi while publishing claims that the company “appears to have a material misstatement of at least $312 million of unrecorded debt. If we are correct, it raises the possibility that there are more extensive misstatements we have not detected.”
SoFi’s stock price dropped by as much as 6.5% to $16.48 during Tuesday’s trading session after the report became public.
The fintech company pushed back forcefully against the allegations, stating: “We have reviewed the full report and believe it is designed to deceive investors. SoFi maintains strong confidence in the integrity of our financial reporting.”
Muddy Waters Research did not provide a response to requests for comment regarding SoFi’s potential legal action when contacted after normal business hours.
