SoFi Rebounds After Debunking $312M Debt Claim and CEO Stock Buy
SoFi Technologies slammed a short seller’s claim that it uses off-balance-sheet structures to hide about $312 million of debt and labeled the allegations factually inaccurate and misleading. The company is considering legal action and its CEO purchased shares, driving the stock up 1.87% on the session.
1. Muddy Waters Allegations
Muddy Waters alleged SoFi used off-balance-sheet structures to mask about $312 million in debt and accused the fintech lender of aggressive financial engineering and mismanaged borrowing.
2. SoFi Rebuttal and Legal Threat
SoFi called the report factually inaccurate and misleading, citing a fundamental misunderstanding of its financials and announced it is considering legal action to defend its reputation.
3. CEO Share Purchase
The company's CEO bought additional shares in the open market, signaling confidence in SoFi's financial position and aligning management interests with shareholders.
4. Stock Reaction
Shares rose 1.87% following the rebuttal and share purchase news as investors reacted positively to the company’s decisive response to the short seller attack.