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NEW YORK, Aug. 05, 2015 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against EZCORP, Inc. (“EZCORP” or the “Company”) (NASDAQ:EZPW) and certain of its officers. The class action, filed in United States District Court, Western District of Texas, Austin Division, is on behalf of a class consisting of all persons or entities who purchased EZCORP securities between October 27, 2014 and July 16, 2015 inclusive (the “Class Period”). This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1934 (the “Exchange Act”).
If you are a shareholder who purchased EZCORP securities during the Class Period, you have until September 18, 2015 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at email@example.com or 888.476.6529 (or 888.4-POMLAW), toll free, ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased.
EZCORP delivers cash solutions to customers across channels, products, services and markets. With approximately 1,400 locations and branches, the Company offers customers multiple ways to access instant cash, including pawn loans and consumer loans in the United States, Mexico, Canada and the United Kingdom.
The Complaint alleges that throughout the Class Period, defendants made false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose: (1) that the Company improperly recognized particular structured assets sales; (2) that the Company improperly classified certain out-of-payroll loans; (3) that, as a result, the Company overstated its gains on assets sales and accrued interest revenue; (4) that, as such, the Company’s financial statements were not prepared in accordance with Generally Accepted Accounting Principles (“GAAP”); (5) that the Company lacked adequate internal and financial controls; and (6) that, as a result of the foregoing, Defendants’ statements were materially false and misleading at all relevant times.
On April 30, 2015, after the market closed, the Company announced that it would delay its earnings release for the second quarter of fiscal 2015, due to an ongoing review of certain elements of its Grupo Finmart loan portfolio. According to the Company, certain errors had been identified in a portion of the Grupo Finmart loan portfolio that could impact current and historical amounts of loan reserves and interest income, and that the Company was conducting a more thorough review to quantify the errors and assess the associated processes and controls.
On this news, shares of EZCORP declined $0.79 per share, over 8%, to close on May 1, 2015, at $8.41 per share, on unusually heavy volume.
On May 20, 2015, after the market closed, the Company revealed that, while the review of the Grupo Finmart loan portfolio was still ongoing, management and the Audit Committee would likely conclude that the Company had a material weakness in internal control over financial reporting and deficiencies in its disclosure controls and procedures.
On this news, shares of EZCORP declined $0.66 per share, over 7%, to close on May 21, 2015, at $8.33 per share, on unusually heavy volume.
On July 17, 2015, the Company announced that it would restate its financial statements for fiscal 2014 (including the interim periods within that year) and the first quarter of fiscal 2015, and that the previously issued financial statements for those periods should no longer be relied upon. According to the Company, the restatement adjustments, all of which are non-cash, will correct certain errors relating to the accounting for Grupo Finmart’s structured assets sales that, based on certain control rights, should not have been recognized as sales. While the Company has not yet quantified the effect of reversing the sale accounting treatment, the Company’s previously recognized $39.6 million of gain ($33.0 million in fiscal 2014 and $6.6 million in the first quarter of fiscal 2015) will be eliminated, but interest income in the periods subsequent to the assets sales will be increased. Additionally, the Company identified a number of out-of-payroll loans that had not been properly classified and accounted for, causing an understatement of bad debt expense and an overstatement of accrued interest revenue in prior periods. According to the Company, the review was still ongoing and financial statements for periods prior to fiscal 2014 could also require restatement.
On this news, shares of EZCORP declined $0.26 per share, nearly 4%, to close on July 17, 2015, at $6.48 per share, on unusually heavy volume.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and Los Angeles, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.
CONTACT: Robert S. Willoughby Pomerantz LLP firstname.lastname@example.orgNEXT ARTICLE
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