Shareholders Foundation, Inc.

Prospect Capital Corporation (NASDAQ:PSEC) Investor Alert: Lawsuit over Alleged Securities Laws Violations Filed

A lawsuit was filed on behalf of investors in Prospect Capital Corporation (NASDAQ:PSEC) shares over alleged securities laws violations. Deadline: July 28, 2014. NASDAQ:PSEC investors should contact the Shareholders Foundation at mail@shareholdersfoundation.com

 

San Diego, CA -- (ReleaseWire) -- 06/02/2014 -- An investor who purchased shares of Prospect Capital Corporation (NASDAQ:PSEC), filed a lawsuit in the U.S. District Court for the Southern District of New York over alleged violations of Federal Securities Laws by Prospect Capital Corporation in connection with certain allegedly false and misleading statements made between August 21, 2013 and May 6, 2014.

Investors who purchased shares of Prospect Capital Corporation (NASDAQ:PSEC) have certain options and for certain investors are short and strict deadlines running. Deadline: July 28, 2014. NASDAQ:PSEC investors should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

According to the complaint the plaintiff alleges on behalf of purchasers of Prospect Capital Corporation (NASDAQ:PSEC) common shares between August 21, 2013 and May 6, 2014, that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.

The plaintiff claims that between August 21, 2013 and May 6, 2014 defendants allegedly misrepresented and/or failed to disclose that certain of Prospect Capital Corporation’s wholly owned companies were investment companies for accounting purposes that were required to be consolidated by the Company, that certain of Prospect Capital Corporation’s wholly owned holding companies should have been accounted for as investment companies, that Prospect Capital Corporation’s reported investment income and financial results were misstated, that Prospect Capital Corporation’s internal and financial controls were inadequate, and that Prospect Capital Corporation’s financial statements were materially false and misleading at all relevant times.

Prospect Capital Corporation reported that its Total Revenue rose from $11.56 million for the 12 months period that ended on June 30, 2010 to $576.34 million for the 12 months period that ended on June 30, 2013 and that its respective Net Income increased from $19.62 million to $220.86 million.

Shares of Prospect Capital Corporation (NASDAQ:PSEC) grew from $8.07 per share in August 2011 to as high as $12.07 per share in September 2012 and continued throughout 2013 to stay above $10 per share.

On May 6, 2014, Prospect Capital Corporation disclosed that the staff of the Securities and Exchange Commission has asserted that certain of Prospect’s wholly owned companies are investment companies for accounting purposes and must be consolidated. Prospect Capital Corporation further disclosed that it may need to restate its prior financial statements to resolve the issue, and that one potential effect of a restatement would be to decrease Prospect Capital Corporation’s historical net investment income by the amount of interest and structuring income paid by such wholly owned companies in excess of the amount of income that may be reported as dividend income based on taxable earnings and profits.

Shares of Prospect Capital Corporation (NASDAQ:PSEC) declined from $10.81 per share on May 5, 2014, to $9.60 per share on May 13, 2014.

On May 29, 2014, NASDAQ:PSEC shares closed at $10.00 per share.

Those who purchased shares of Prospect Capital Corporation (NASDAQ:PSEC) have certain options and should contact the Shareholders Foundation.

Contact:
Shareholders Foundation, Inc.
Trevor Allen
3111 Camino Del Rio North - Suite 423
92108 San Diego
Phone: +1-(858)-779-1554
Fax: +1-(858)-605-5739
mail@shareholdersfoundation.com