AutoChina International Limited Under Investor Investigation Over Possible Securities Laws Violations
April 17, 2012 -- On April 11, 2012, the U.S. Securities and Exchange Commission ("SEC") filed a complaint in the U.S. District Court for the District of Massachusetts against AutoChina International Limited and certain individuals over alleged violations of the securities laws. The SEC alleged that the AutoChina International Limited defendants conducted a market manipulation scheme to create the false appearance of a liquid and active market for AutoChina International Limited's stock in order to obtain financing.
According to the SEC's complaint, beginning in October 2010 until February 2012, the defendants and others deposited millions into brokerage accounts based in the United States and engaged in hundreds of allegedly fraudulent trades.
The complaint alleges that prior to opening these brokerage accounts, the average trading volume of AutoChina's stock was approximately 18,000 shares, but in the three months after these accounts were opened, the daily trading volume increased to 139,000 shares. During the period of November 1, 2010 through January 31, 2011, trading by the defendants and related accounts generated as much as 70% of AutoChina's trading volume.
Following the news of the lawsuit by the SEC, AutoChina International Ldt. said it believes that it is without merit and that it intends to defend against the claims vigorously.
Shares of AutoChina International Limited (OTC:AUTCF) dropped from $26 on February 13, 2012 to $15 per share on April 12, 2012.
July 10, 2011 (Shareholders Foundation) -- An investigation on behalf of investors in shares of AutoChina International Limited (NASDAQ: AUTC) over possible violations of Securities Laws was announced.
The investigation by a law firm focuses on possible shareholder claims based on potential violations of the federal securities laws. Specifically the investigation concerns whether AutoChina International Limited or others may have violated securities laws by issuing a series of statements regarding its business, its prospects and its operations that were materially false and misleading at the time they were made.
AutoChina Intl Ltd reported to the U.S. Securities and Exchange commission a substantial increase in its annual Revenue from $36.30million for 2008 to $622.07million for 2010 and its Net Income from $8.04million for 08 to $37.51million in 2010. For the first quarter in 2011 AutoChina International Limited reported quarterly Revenue of $136.23million compared to $120.73million a year earlier and a quarterly Net Income of $10.00million for the first quarter in 2011 compared to $6.25million one year earlier.
Shares of AutoChina International Limited (Public, NASDAQ:AUTC) rose from as low as $16.05 per share in December 09 to as high as $44.49 per share in March 2010 and traded recently as high as $38.56 on March 11, 2011.
Then on June 30, 2011, AutoChina International disclosed that the Company is being investigated by the U.S. Securities Exchange and Commission and that it expects to restate its previously issued financial statements for the year ended December 31, 2009, and subsequent quarterly periods to recognize a derivative liability relating to the Earn-out Share Provision (“Earn-out”), which was part of its initial business combination in 2009.
AutoChina International Limited said that it and one of its officers have received subpoenas for information.
NASDAQ: AUTC stock fell from over $29 on June 30 to $18 during July 1 and closed on Thursday July 7, 2011 at $26.35 per share.