Ready Capital Lawsuit Alert: Investors Allege Fraud Amid CRE Portfolio Woes – What You Need to Know

Investors in Ready Capital Corporation (NYSE: RC) are facing a pivotal moment as a class action lawsuit filed in April 2025 seeks to address alleged securities fraud that may have caused significant financial harm. Led by the law firm Levi & Korsinsky, LLP, the case targets the company’s management for allegedly misleading investors about the health of its commercial real estate (CRE) loan portfolio and improper accounting practices. With a deadline looming for investors to join the lawsuit, here’s what you need to know.

The Allegations: A Web of Misstatements and Omissions

The lawsuit, filed on April 10, 2025, accuses Ready Capital of making materially false or misleading statements between November 7, 2024, and March 2, 2025. At the core of the complaint are four key issues:

1. Non-Performing CRE Loans: The company is accused of downplaying the existence of a substantial number of CRE loans deemed “unlikely to be collectible.” These loans allegedly posed a significant risk to Ready Capital’s financial stability.
2. Improper Reservations: Ready Capital allegedly reserved the full value of these problematic loans to “stabilize” its portfolio—a move that should have been reflected in its financial statements but was not adequately disclosed.
3. Faulty CECL Calculations: The complaint claims the company failed to properly account for these issues in its Current Expected Credit Loss (CECL) models and valuation allowances, leading to inflated financial results.
4. Misleading Guidance: Management’s positive statements about the company’s prospects were allegedly detached from reality, as the concealed risks began to impact financial performance.

The lawsuit argues that these misstatements created a false sense of security for investors, artificially inflating the stock price during the class period. Once the truth emerged, the stock likely suffered a sharp decline, leaving investors with significant losses.

The Legal Landscape: Levi & Korsinsky’s Track Record

Levi & Korsinsky, LLP—a New York-based firm with a 20-year history of securities litigation—has been entrusted with this case. The firm’s reputation is underscored by its inclusion in ISS Securities Class Action Services’ Top 50 Report for seven consecutive years, a testament to its success in recovering over $600 million for shareholders.

The firm emphasizes that participation in the class action is free of upfront costs, as it operates on a contingency basis. Investors who purchased RC shares during the specified period have until May 5, 2025, to file a motion to become lead plaintiff. Even those not seeking this role are encouraged to submit claims to secure potential recovery.

Implications for Investors: Act Now or Risk Missing Out

The lawsuit’s success hinges on proving that Ready Capital’s disclosures were intentionally misleading or omitted critical risks. For investors, the stakes are clear:

• Timing is Critical: The May 5 deadline is non-negotiable. Delaying action could forfeit eligibility for compensation.
• No Financial Risk: Levi & Korsinsky’s contingency fee structure ensures investors pay nothing unless the case results in a recovery.
• Historical Precedent: The firm’s track record suggests a credible path to recovery, even against a company as complex as Ready Capital.

Conclusion: A Crossroads for Ready Capital Investors

The allegations against Ready Capital highlight a recurring theme in corporate governance: the consequences of opaque financial reporting. With CRE loans central to the company’s business model, the failure to disclose risks could have far-reaching implications for its credibility and shareholder value.

For investors, the lawsuit represents both a warning and an opportunity. By acting swiftly to join the class action, affected shareholders can seek accountability and potential compensation. Levi & Korsinsky’s proven record and the firm’s focus on securities litigation provide a strong foundation for this case.

As the deadline approaches, investors are urged to consult the complaint or contact the firm directly. With hundreds of millions of dollars recovered in similar cases, the path forward is clear: act decisively, or risk losing the chance to reclaim losses.

Deadline reminder: Investors must request lead plaintiff status by May 5, 2025.