AmTrust Financial Services, Inc. investors may receive additional information about the case by clicking the link "Join this Class Action" above.
According to the complaint, AmTrust, through its subsidiaries, underwrites and provides property and casualty insurance in the United States and internationally.
The Class Period commences On May 10, 2016, the company filed a Form 10-Q for the quarterly period ended March 31, 2016 with the SEC.
The complaint alleges that, on February 27, 2017, the company issued a press release revealing that it had identified material weaknesses in its internal control over financial reporting that existed as of December 31, 2016. Specifically, AmTrust stated, “the Company identified material weaknesses in its internal control over financial reporting that existed as of December 31, 2016, specifically related to ineffective assessment of the risks associated with the financial reporting, and an insufficient complement of corporate accounting and corporate financial reporting resources within the organization.”
Following this news, shares of AmTrust fell $5.32 per share or over 19% from its previous closing price to close at $22.34 per share on February 27, 2017.
Then, on March 16, 2017, the Company disclosed that “the Audit Committee of the AmTrust Board of Directors, in consultation with management and its current and former independent auditors, concluded that the Company’s previously issued consolidated financial statements for 2014 and 2015 (including for each of the four quarters of 2015) as well as for the first three quarters of 2016 should be restated and should no longer be relied upon.” Additionally, AmTrust reported that “the reports of BDO USA LLP, the Company’s former independent auditor, on the Company’s consolidated financial statements for 2014 and 2015, including its opinions on the effectiveness of internal control over financial reporting for such periods, likewise should no longer be relied upon.”
Following this update, shares of AmTrust’s stock declined an additional $4.03 per share, or over 18%, to close on March 17, 2017 at $17.58 per share.
The complaint alleges that, throughout the Class Period, the defendants made false and/or misleading statements and/or failed to disclose that: (1) the company had ineffective assessment of the risks associated with the financial reporting; (2) the company had an insufficient complement of corporate accounting and corporate financial reporting resources within the organization; (3) in turn, the company lacked effective controls over financial reporting; and (4) as a result, the defendants’ statements about the company’s business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.
If you are a member of the class described above, you may no later than May 1, 2017 move the Court to serve as lead plaintiff of the class, if you so choose.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will will adequatley represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of their choice, or may choose to do nothing and remain an inactive class member.
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