NASDAQ : DLO
- Francis v. dLocal Limited, et al.
- Class Period:May 02, 2022 - May 25, 2023
- Date Filed:October 06, 2023
- Jurisdiction:U.S. District Court, Eastern District of New York
- Docket Number: 1:23-cv-07501
- Lead Plaintiff Deadline: December 5, 2023
Seek Plaintiff 1
A class action lawsuit, captioned Francis v. dLocal Limited, et al., No. 1:23cv07501 (E.D.N.Y.), has been filed against dLocal Limited (“dLocal” or the “Company” (NASDAQ: DLO) and certain of its top executive officers alleging that they violated the federal securities laws. The lawsuit seeks to represent purchasers or acquirers of dLocal securities between May 2, 2022, and May 25, 2023, inclusive (the “Class Period”).
dLocal operates a payment processing platform for merchants worldwide and, as part of its operations, engages in certain foreign exchange transactions. As a result, the Company is subject to the various foreign exchange regulations and controls of the countries within which it operates, including, inter alia, Argentina, which has historically been one of the Company’s most important markets.
As alleged in the dLocal lawsuit, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operations, and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) dLocal engaged in certain improper conduct and transfers abroad in violation of Argentine laws and/or regulations, including, inter alia, foreign exchange regulations; (ii) accordingly, dLocal’s compliance controls and procedures, including its disclosure controls and procedures and internal controls over financial reporting, were deficient; (iii) all the foregoing subjected the Company to a heightened risk of governmental and/or regulatory scrutiny in Argentina and/or enforcement action by Argentine authorities; and (iv) as a result, the Company’s public statements were materially false and misleading at all relevant times.
The dLocal lawsuit further alleges that on May 26, 2023, Argentine news outlet Infobae published an article reporting that the Argentine government was investigating dLocal for a possible $400 million fraud. Specifically, Infobae reported that the government was investigating the Company for “improper maneuvers” and transfers abroad, with unnamed sources alleging that dLocal “operates as a mere instrument to take advantage of the exchange rate gap and to take dollars abroad with operations that are not reflected in the accounting.” The same day, dLocal issued a response to the Infobae article, characterizing it as “misleading” and “factually incorrect” and assuring investors that the Company is in “close contact with [Argentine] authorities”, and that, “[a]s of today, we have not been notified by any Argentinian [sic] authority regarding a foreign exchange investigation.” Following these developments, dLocal’s common share price fell $2.39 per share, or 17.32%, to close at $11.41 per share on May 26, 2023.
On June 5, 2023, dLocal disclosed in an SEC filing that it “received a request for information from Argentine customs authorities, although the Company notes that expatriation rules and foreign exchange operations are regulated by the Argentine Central Bank”; that “[o]n June 1, 2023 . . . the Company confirmed with a local Argentine court that a petition for inquiry had been filed by an Argentine prosecutor on May 30, 2023 in response to the same article published by [Infobae] seeking information using as a basis for the request the above-mentioned article”; and that “[t]he Company intends to respond to any and all requests for information from regulatory authorities to demonstrate that it has acted in accordance with applicable regulations.”
Then, on June 15, 2023, dLocal issued a press release revealing that it was in fact “engag[ing] with senior representatives of the Argentine federal government to discuss, among other matters, the manner in which dLocal operates in the country, including dLocal’s compliance with foreign exchange regulations.”
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If you purchased dLocal securities during the Class Period and suffered substantial losses, and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. You can also contact DiCello Levitt partner Brian O’Mara by calling [NUMBER] or at firstname.lastname@example.org.
The deadline to apply to the Court to serve as a lead plaintiff in the dLocal lawsuit lawsuit is December 5, 2023.