Investors File Lawsuit Against Detroit-Based Digital Mortgage Lender, Rocket Mortgage
From our source comes the latest report about a class action lawsuit filed by shareholders against Rocket Mortgage, an online mortgage lender based in Detroit. According to the shareholders, the mortgage company misled them about its financial status during the year 2021. The lawsuit, which was initiated in June 2021 and streamlined in April of the same year, has gained momentum, underpinned by a group of investors who claim they were given false information by the company executives.
Claims of False Information on Key Business Parameters
The aggrieved investors allege that Rocket Mortgage distributed false data regarding key business metrics, including interest rates, market share, and company expansion. They insist that although a brief rise in the company’s stock price occurred during a meme stock incident in March 2021, this price still reflected the alleged deceptive statements made by the company
Insider Trading Accusations Against the Company Founder, Dan Gilbert
The shareholders’ complaints don’t end with the deceptive statements; they also accuse Dan Gilbert, the founder of the company, of profiting from insider trading. According to allegations, Gilbert conducted a confidential trade valued at $500 million before issuing an earnings report, thus earning considerable profits from inside information. Rocket Mortgage, on the other hand, defends its leadership and insists they acted within legal constraints.
Scheduled Mediation Amid Falling Market Shares
As the financial wrangle intensifies, a closed-door mediation has been slotted for March 27, 2024. Meanwhile, our source has released a new report revealing a decrease in Rocket’s market share. This dip is connected to its over-dependence on the refinance market. Given that the company’s share in the purchase market isn’t expected to realize substantial growth in the coming years, it appears that Rocket Mortgage is not out of the woods just yet.
- Class action lawsuit filed by Rocket Mortgage shareholders, claiming they were misled about the company’s financial status in 2021.
- Accusations that the company provided false data on interest rates, market share, and growth.
- Founder Dan Gilbert accused of profiting from insider trading.
- Mediation scheduled for March 27, 2024, amidst falling market shares for the mortgage lender.
