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Ready Capital (RC) Faces Investor Backlash as Lawsuit Alleges Concealed CRE Loan Woes– Hagens Berman

1. Ready Capital named in securities class-action lawsuit, impacting investor confidence. 2. Allegations include downplaying troubles in the commercial real estate loan portfolio. 3. Company reported significant losses, prompting a nearly 27% stock price drop. 4. Hagens Berman investigates potential misleading financial disclosures. 5. Investors urged to report losses or assist with the ongoing investigation.

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FAQ

Why Very Bearish?

The securities lawsuit and significant losses signal serious operational issues and investor distrust, similar to past cases like Hudson Pacific Properties, which faced lawsuits leading to stock downturns due to misleading disclosures.

How important is it?

The lawsuit and its implications on financial transparency pose critical risks to investor capital, significantly influencing RC’s market perception and price.

Why Short Term?

The immediate effects are already evident in stock price movement; however, longer-term recovery hinges on legal outcomes and management changes.

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SAN FRANCISCO, April 18, 2025 (GLOBE NEWSWIRE) -- Ready Capital Corporation (NYSE: RC), a New York-based real estate finance firm, is grappling with intensifying investor scrutiny after being named in a securities class-action lawsuit that has cast a shadow over its financial reporting and sent its stock tumbling. Hagens Berman is investigating the alleged claims and urges investors who purchased Ready Capital shares and suffered substantial losses to submit your losses now. The firm also encourages persons with knowledge who may assist the firm’s investigation to contact its attorneys. Class Period: Nov. 7, 2024 – Mar. 2, 2025Lead Plaintiff Deadline: May 5, 2025Visit: www.hbsslaw.com/investor-fraud/rc Contact the Firm Now: RC@hbsslaw.com 844-916-0895 Ready Capital (RC) Securities Class Action: The lawsuit, filed in the U.S. District Court for the Southern District of New York under the case name Quinn v. Ready Capital Corporation, accuses the company and several top executives of violating federal securities laws. Central to the complaint are allegations that Ready Capital downplayed the extent of trouble in its commercial real estate (CRE) loan portfolio, particularly regarding a sizable tranche of loans that were not performing as expected. According to court documents, plaintiffs claim that between November 2024 and early March 2025, Ready Capital issued statements that were either misleading or omitted critical information about the true state of its business. Among the key contentions: the company allegedly failed to alert investors to the magnitude of non-performing CRE loans, did not disclose that full reserves would be required to cover these problematic assets, and failed to accurately reflect these risks in its reported credit loss allowances. The complaint further asserts that these omissions painted an overly optimistic picture of Ready Capital’s financial health. The issue reached a boiling point on March 3, 2025, when Ready Capital stunned the market with a fourth-quarter net loss of $1.80 per share and a full-year loss of $2.52 per share for 2024. The company attributed the downturn to “decisive actions” taken to strengthen its balance sheet, including a sweeping $284 million reserve for underperforming CRE loans. The company also halved its quarterly dividend and reported a sharp drop in book value. The market responded with alarm. Shares of Ready Capital nosedived nearly 27% following the announcement, wiping out a significant chunk of shareholder equity and raising fresh doubts about the company’s risk management and disclosure practices. Hagens Berman’s Investigation: Investor rights law firm Hagens Berman has launched an active investigation into Ready Capital’s financial disclosures and practices during the class period. The firm, known for its focus on corporate accountability, is urging investors who suffered substantial losses to come forward and share information that could aid its probe. Reed Kathrein, a partner at Hagens Berman leading the investigation, stated, “Our investigation seeks to uncover whether Ready Capital deliberately obscured the severity of its non-performing loans, leaving investors in the dark about the true risks facing the company’s commercial real estate portfolio.” If you invested in Ready Capital and have substantial losses, or have knowledge that may assist the firm’s investigation, submit your losses now » If you’d like more information and answers to frequently asked questions about the Ready Capital case and our investigation, read more » Whistleblowers: Persons with non-public information regarding Ready Capital should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email RC@hbsslaw.com. About Hagens Berman Hagens Berman is a global plaintiffs’ rights complex litigation firm focusing on corporate accountability. The firm is home to a robust practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and other wrongdoings. Hagens Berman’s team has secured more than $2.9 billion in this area of law. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw. Contact: Reed Kathrein, 844-916-0895

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