Ebix, Inc. Faces Long Term Investor Investigation

If you purchased Ebix, Inc. (NASDAQ:EBIX) stock and currently hold those NASDAQ EBIX stocks, you have certain options and you should contact the Shareholders Foundation, Inc.

To have your information reviewed for options and to recieve notifications about this investigation, please use this form. You may also send an email to mail@shareholdersfoundation.com, or call us at (858) 779-1554.
Company Name(s): 
Ebix
Affected Securities: 
NASDAQ: EBIX

An investigation on behalf of current long term investors in shares of Ebix, Inc. (NASDAQ:EBIX) over possible breaches of fiduciary duties by certain directors of Ebix, Inc was announced.

The investigation for current long term EBIX stockholders follows a lawsuit filed earlier in United States District Court for the Southern District of New York on behalf of investor who purchased their EBIX shares only between May 6, 2009 to June 30, 2011. According to that complaint the plaintiff alleges that Ebix, Inc violated the Securities Exchange Act of 1934 by issuing between May 6, 2009 through June 30, 2011 false and misleading statements, as well as failing to disclose material adverse facts about Ebix’ business, operations, and prospects.

The lawsuit follows a report on Seeking Alpha with the title: “Ebix: Not a Chinese Fraud, But a House of Cards Nonetheless” on March 24, 2011 accusing Ebix, Inc of engaging in a number of accounting manipulations.

Atlanta based supplier of software and e-commerce solutions Ebix’s 12months Total Revenue increased from $42.84million in 2007 to $132.19million in 2010. Its Net Income rose from $12.67million in 07 to $59.02million in 2010. Shares of Ebix, Inc. (Public, NASDAQ:EBIX) rose from under $15 in 2010 to as high as $29.72 on March 23, 2011. Then on March 24, 2011 EBIX shares fell from as high as $30.21 to $21.47 and closed Thursday’s trading at $22.52 per share.

Among other things, report on Seeking Alpha stated, that they “believe that EBIX is nothing more than a roll-up that has materially misrepresented its business (relative to the CEO's buzz words) as well as its organic growth. Its business model is predicated on two principals: tax arbitrage and dramatic cost cuts (headcount reductions and offshoring), neither of which is sustainable. Further, the company's tax arbitrage may be more than "just" unsustainable, it may actually be illegal. EBIX's problems run deeper than unusual accounting. The EBIX story also comes with multiple auditor resignations, governance abuses, misrepresented organic growth, questionable cash flow and a contentious CEO. “