BT Group plc (ADR) (NYSE:BT) Investor Securities Class Action Lawsuit 01/24/2017
January 24, 2017 (Shareholders Foundation) - An investor in shares of BT Group plc (ADR) (NYSE:BT) filed a lawsuit in the U.S. District Court for the District of New Jersey over alleged violations of Federal Securities Laws by BT Group plc in connection with certain allegedly false and misleading statements made between May 24, 2012 and January 20, 2017.
According to the complaint the plaintiff alleges on behalf of purchasers of BT Group plc (ADR) (NYSE:BT) common shares between May 24, 2012 and January 20, 2017, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that between May 24, 2012 and January 20, 2017 the Defendants made false and/or misleading statements and/or failed to disclose thatBT Group misstated its earnings due to improper accounting practices and improper sales, purchase, factoring and leasing transactions in its Italian operations, that BT Group lacked effective internal controls, and that as a result, Defendants’ statements about BT Group’s business, operations and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times.
BT Group plc reported that its Total Revenue rose from $22.34 billion for the 12 months period that ended on March 31, 2015 to over $23.66 billion for the 12 months period that ended on March 31, 2016 and that its Net Income for those respective time periods increased from over $2.67 billion to over $3.24 billion.
On October 27, 2016, BT Group plc announced its results for its second quarter to September 30, 2016. BT Group plc also disclosed that during an initial internal investigation it identified certain historical accounting errors and reassessed certain areas of management judgement in its BT Italia operations and announced the write down of items on the balance sheet by £145m.
On January 24, 2017, BT Group plc announced an update on its investigation into BT’s Italian business and on its outlook. BT Group plc revealed that it had underestimated the extent of the accounting scandal at its Italian division and was taking a write-down of £530m—more than three times its previous estimate of £145m—for improper accounting practices and transactions in Italy over a number of years.
Shares of BT Group plc (ADR) (NYSE:BT) declined from $35.87 per share in February 2016 to as low as $19.14 per share on January 24, 2017.