NEW YORK, Nov. 27, 2013 (GLOBE NEWSWIRE) -- Pomerantz Grossman Hufford Dahlstrom & Gross LLP announces the filing of a class action lawsuit against DFC Global Corp. ("DFC Global" or the "Company") (Nasdaq: DLLR ) and certain of its officers. The class action, filed in United States District Court, Eastern District of Pennsylvania, on behalf of a class consisting of all persons or entities who purchased or otherwise acquired securities of DFC Global between January 28, 2011 and August 22, 2013 both dates inclusive (the "Class Period"). This class action seeks to recover damages against the Company and certain of its officers and directors as a result of alleged violations of the federal securities laws pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder.
If you are a shareholder who purchased DFC Global securities during the Class Period, you have until January 21, 2014 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 rswilloughby@pomlaw.com or 888.476.6529 (or 888.4-POMLAW), toll free, x237. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased.
DFC Global is a non-bank provider of alternative financial services such as payday loans and secured pawn loans.
The Complaint alleges that throughout the Class Period, Defendants knew but misrepresented or concealed from investors that: (i) DFC Global systematically issued high-fee predatory loans to consumers that had no reasonable means to be repaid; (ii) the Company continuously rolled over or refinanced its loans in order to delay or avoid defaults; (iii) DFC Global failed to conduct adequate affordability assessments on its customers; (iv) DFC Global understated its loan loss rates; (v) the Company's earnings guidance for its 2013 fiscal year was inflated because it was dependent upon the Company's improper lending practices; and (vi) as a result of DFC Global's irresponsible lending, the Company failed to comply with industry regulations and guidance.
On April 1, 2013, the Company preannounced results for its third quarter of 2013 that were seriously impacted by poor loan performance. Specifically, during the earnings conference call, the Company announced that the Consumer Finance Association rollover limit caused a significant number of DFC Global's outstanding loans in the United Kingdom to become immediately due and default because they could not be repaid. According to DFC Global, the Company as a whole experienced a loss rate of above 25% (compared to 20.6% year-over-year), and a loss rate of approximately 35% in the United Kingdom. On this news, the share price of the Company's stock dropped from $16.64 per share to $13.04 per share, or almost 22% on April 1, 2013.
On August 22, 2013, DFC Global announced earnings for its fourth quarter of 2013 during which it reported soaring loan defaults in the United Kingdom with the Company's loan loss provision increasing to 25.7% from 20.8%, year-over-year. Additionally, DFC Global disclosed that it expected to incur a recurring $10-$15 million of expenses for regulatory, legal, audit, and compliance-related costs relating to its payday lending program. DFC Global's losses in the United Kingdom were so severe that the Company was unable to provide earnings per share guidance for fiscal 2014. On this news, the share price of DFC Global stock fell from $15.90 per share to $11.31 per share, or almost 29% on August 22, 2013.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and San Diego, 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 .
Robert S. Willoughby Pomerantz Grossman Hufford Dahlstrom & Gross LLP
