Deadline Looms for Open Lending Investors: Faruqi & Faruqi’s Class Action Investigation

Investors in Open Lending Corporation (NASDAQ: LPRO) are under a tight deadline to act as the law firm Faruqi & Faruqi LLP advances its securities class action investigation. The firm alleges that Open Lending misled the market with material omissions and false statements, leading to catastrophic stock losses. With a critical August 2, 2025, deadline for claim submissions, affected shareholders must act swiftly to protect their rights.

The Investigation’s Grounds: Financial Missteps and Investor Harm

The probe centers on two pivotal events in early 2025:
1. Delayed Earnings Release (March 17, 2025): Open Lending postponed its quarterly earnings and filed a Form 12b-25 with the SEC to delay its annual 10-K report. This triggered an immediate 9.3% stock drop to $3.91, injuring investors.
2. Disclosure of Catastrophic Losses (March 31, 2025): The company revealed a substantial year-over-year net loss increase, driven by a valuation allowance on deferred tax assets. This caused a further 57.6% plunge to $1.17 by April 1, 2025.

The law firm argues these disclosures exposed concealed risks, including flawed financial management and leadership instability.

Legal Claims and Securities Violations

Faruqi & Faruqi alleges Open Lending violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by:
- Misleading investors about its financial health and tax liabilities.
- Failing to disclose material risks like the valuation allowance or leadership changes.
- Inflating stock prices through false assurances of stability.

The firm seeks recovery for investors who held LPRO shares between April 1, 2024, and March 17, 2025—a period during which the stock lost over 70% of its value.

Historical Context: A Pattern of Regulatory Scrutiny

Open Lending’s struggles are not new. In 2021, the SEC fined the company $15 million for fraudulent loan disclosures and undisclosed fees, requiring compliance reforms. The current investigation underscores ongoing governance concerns.

The Deadline: Act Before August 2, 2025

While the SEC’s prior case had a June 3, 2025, claims deadline, the Faruqi-led class action sets a hard cutoff of August 2, 2025, for investors to submit claims or seek lead plaintiff status. Missing this deadline could permanently bar eligibility for recovery.

Conclusion: A High-Stakes Moment for Investors

The data is stark: Open LPRO’s stock price has collapsed by over 85% since mid-2024 (), and the company’s Q4 2024 EBITDA hit a staggering -USD 78.49 million, an 888% annual decline. These figures align with allegations of financial mismanagement.

With Faruqi’s track record of recovering hundreds of millions for investors and the August 2 deadline looming, affected shareholders must act now. Failing to do so risks forfeiting the chance to recover losses from what appears to be a pattern of corporate missteps. Time is running out—contact the firm or consult an attorney to safeguard your position.

Investors are urged to seek legal counsel promptly to navigate this complex landscape.