SAN DIEGO & DALLAS–(BUSINESS WIRE)–Shareholder rights law firm Robbins LLP announces that a purchaser of MoneyGram International, Inc. (NASDAQ: MGI) filed a class action complaint against the Company and its officers and directors for alleged violations of the Securities Exchange Act of 1934 between June 17 2019 and February 22, 2021.
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MoneyGram International, Inc. (MGI) Misled Investors About
According to the complaint, on June 17, 2019, MoneyGram announced it was entering into a strategic partnership with Ripple Labs, Inc. Ripple is a blockchain technology company and the developer of cryptocurrency XRP. As part of the partnership, Ripple agreed to invest up to $50 million in MoneyGram stock. On this news, the price of MoneyGram stock increased over 150%. Throughout the relevant period, MoneyGram touted the partnership, stating that it will reduce our working capital needs and generate additional earnings and cash flows.” The Company also made statements regarding the strong contribution that market development fees received from Ripple made to MoneyGram’s financial results.
On December 22, 2020, the Securities and Exchange Commission (“SEC”) filed a lawsuit against Ripple, alleging that Ripple’s cryptocurrency XRP is an unregistered security in violation of the securities laws. With regard to MoneyGram’s involvement, the SEC complaint explains that the major non-investment use of the XRP cryptocurrency is transferring money on Ripple’s ODL platform and that in order to convince anyone to use ODL to transfer money, Ripple had to make a $50 million equity investment and pay sufficient financial compensation to an entity referred to as the “Money Transmitter,” i.e., MoneyGram. The SEC complaint further explains how MoneyGram took park in the sale of unregistered XRP securities on the open market.
On February 22, 2021, MoneyGram filed its annual report on Form 10-K for the year ended December 31, 2020, stating: “MoneyGram ceased transacting with Ripple under the commercial agreement in early December 2020 and has not resumed trading. It is possible that MoneyGram will not resume transacting with Ripple … and will be unable to receive the related market development fees in 2021 and beyond.” On this news, MoneyGram stock fell 33.2%, from a closing price of $10.87 on February 19, 2021, to $7.26 on February 23, 2021.
If you purchased shares of MoneyGram International Inc. (MGI) between June 17, 2019 and February 22, 2021, you have until April 30, 2021, to ask the court to appoint you lead plaintiff for the class.
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