Netcapital faces securities fraud class action lawsuit
Shareholders are invited to join a class action lawsuit against Netcapital Inc. following allegations of improper revenue recognition and misleading financial reporting.
Law firm Schall, Brown & Schwartz (SBS) has initiated a securities class action lawsuit against Netcapital Inc. regarding alleged violations of the Securities Exchange Act of 1934. The litigation covers the period between December 15, 2021, and September 3, 2026.
The complaint alleges that Netcapital misled investors by improperly recognizing revenue from consulting agreements with entities linked to company insiders. According to the filing, these agreements were allegedly forged or backdated and involved no legitimate business activity, resulting in materially false public financial statements.
Investors who incurred losses during the class period are eligible to apply for lead plaintiff status. The deadline to submit an application to the court is December 7, 2026. The class has not yet been certified, and legal representation is currently optional for those wishing to participate in a potential recovery.