Business

Pomerantz LLP Probes into The Bancorp, Inc. for Alleged Securities Fraud and Misconduct

NEW YORK, March 27, 2024 /PRNewswire/ -- Pomerantz LLP, a powerhouse in the realm of corporate, securities, and antitrust class litigation, is currently undertaking an investigation on behalf of the shareholders of The Bancorp, Inc. (referred to as "TBBK" or the "Company") which is listed on NASDAQ. Investors with a stake in TBBK who have concerns or queries regarding their investment are being encouraged to reach out to Danielle Peyton for a conversation either by email at [email protected] or by telephone at 646-581-9980, extension 7980.

The core of this investigation is to determine whether TBBK and select members of its executive team have partaken in securities fraud or other unlawful activities within their business operations.

For investors seeking more information about the potential class action, there is a resource available here: joining the class action.

This swift and decisive line of inquiry by Pomerantz came about after a significant drop in TBBK's share value, which occurred on March 21, 2024. This steep decline can be attributed to a scathing publication by Culper Research, a well-known activist short seller. Culper Research has cast serious doubts on TBBK's representation of the quality of its real estate bridge loan (REBL) portfolio. Moreover, Culper argues that the loss reserves that TBBK has purportedly designated to cover these loans are grossly inadequate. With the disparaging title "The Bancorp Inc. (NASDAQ: TBBK) Bridge to Nowhere," Culper's report pulls from several investigations, including a meticulous loan-by-loan assessment, site visits to more than twenty TBBK-funded locations over the preceding two weeks, comprehensive dialogues with former employees of TBBK, including one who was directly involved in the REBL underwriting process, in addition to discussions with a number of TBBK borrowers and syndicators.

Culper Research paints a dreary picture of TBBK's client base, describing them as "unsophisticated syndicated borrowers" with "get rich quick dreams." These borrowers were seemingly convinced that they could swiftly refurbish rental units, attract tenants, hike up rents, and cash out on their investments for rapid, 'passive' profits. However, the truth turned out to be starkly different— refurbishment costs soared, vacancies persisted, rent levels plateaued, and to worsen matters, interest rates climbed sharply to more than double their initial rates. In Culper's assessment, TBBK's decision to reserve a mere $4.7 million—a paltry 0.24% of its REBL portfolio—is nothing short of farcical.

The aftermath of these accusations led to a precipitous decline in TBBK's stock value, which plunged by $3.63 per share—that's a considerable 10.15% drop—to finally settle at $32.12 per share on March 21, 2024.

Pomerantz LLP, a firm with a storied legacy and offices heartily scattered across major cities like New York, Chicago, Los Angeles, and extending beyond to London, Paris, and Tel Aviv, is renowned for its dedication to fighting on behalf of the victims of securities fraud. The firm's origin dates back to its founder, Abraham L. Pomerantz, a distinguished authority often heralded as the dean of the class action bar. His pioneering efforts in securities class actions laid the groundwork for what Pomerantz LLP represents today. Even after 85 eventful years, the firm continues to uphold the same zeal and commitment, securing massive damages awards for affected class members. Interested parties can find further details on Pomerantz's rich history and their ongoing mission to combat securities fraud by visiting www.pomlaw.com.

For additional inquiries or detailed explanations about this investigation, Danielle Peyton of Pomerantz LLP eagerly awaits correspondence via email at [email protected], or by phone at 646-581-9980, extending her availability at extension 7980.

Source: Pomerantz LLP

Culper's Contentions and TBBK's Stock Tumble

Upon the release of Culper Research's denunciatory report, the ensuing decline in the stock price illustrates a market rattled by their findings. Culper's meticulous dissection of TBBK's loan portfolio and the subsequent criticism of their reserves brings to light severe concerns regarding the company's transparency and risk management practices. If these allegations are substantiated, TBBK might confront significant repercussions from both regulators and the investor community at large.

The Role of Pomerantz in Safeguarding Shareholder Rights

As Pomerantz LLP delves into these allegations, their long-standing reputation for protecting investors and navigating complex class actions provides reassurance to TBBK shareholders. Their investigative expertise, combined with a robust legal acumen, may potentially unveil critical insights into the depths of the alleged fraudulent activities. Through their unwavering commitment to upholding integrity in the marketplace, Pomerantz LLP seeks to ensure that justice prevails and that those affected are aptly compensated.

The seriousness of these charges against The Bancorp, Inc. and specific personnel warrants heightened scrutiny. As the financial ecosystem relies heavily on the tenets of honesty and accountability, any deviation through fraudulent activities jeopardizes not just the investors directly impacted, but the very fabric of the market structure.

Next Steps for Investors and TBBK's Response

Investors of TBBK, who are grappling with uncertainties following these developments, now await the outcome of Pomerantz LLP's investigatory efforts. In turn, TBBK is expected to provide a comprehensive response to Culper's allegations, shedding light on the points raised in the report and articulating the steps they are taking to address any potential issues in their REBL portfolio and reserve policies.

Amidst these tumultuous times, ensuring access to accurate information is crucial for those invested in TBBK, as the decisions they make in the coming days may significantly impact their financial position. For investors considering joining the class action, Pomerantz LLP has detailed pertinent information on their approach and how they plan to represent the interests of those affected by the alleged misconduct.

The Legacy of Pomerantz LLP in Class Action Litigation

The legacy of Pomerantz LLP in the annals of class action litigation sets a precedent for an aggressive and meticulous legal pursuit of corporate wrongdoing. Known for cultivating a legacy of success in securing landmark judgements, Pomerantz upholds the principles set forth by its founder, continuously striving to enact substantial change and hold negligent corporations accountable.

Justice, served through the legal frameworks established by firms like Pomerantz LLP, restores investors' faith in the mechanisms designed to guard against corporate misconduct. With every case they undertake and each victory they secure, they reiterate the importance of every investor's right to operate in a fair and transparent financial market.

As this investigation unfolds, what remains at the heart of Pomerantz LLP's pursuit is their relentless commitment to function as the custodians of investor rights, ever-vigilant against the perils of corporate mishandling. It is this dedication that has cemented Pomerantz's position as a formidable entity in the landscape of securities and antitrust class litigation.

Conclusion and Contact Information

The pioneering spirit of Abraham L. Pomerantz is omnipresent as the firm continues to spearhead efforts against financial improprieties, and this current investigation into TBBK's activities represents yet another chapter in their enduring narrative. As the inquiry progresses, Pomerantz LLP will provide updates and guidance for those investors entangled within this disconcerting situation.

Investors and interested parties who require further information or wish to contribute to Pomerantz LLP's endeavors can confidently reach out to attorney Danielle Peyton. With a direct line of communication established, TBBK shareholders can now navigate this complexity with the backing of a venerated legal firm.

For additional information, legal counsel, or to join the class action, visit Pomerantz LLP's website or contact Danielle Peyton at:

Email: [email protected] Phone: 646-581-9980 (ext. 7980)

As events continue to unfold, shareholders and the broader public eagerly anticipate the resolution of these serious allegations and the affirmation of integrity within the sectors of securities and corporate governance.