Prosper is the latest Silicon Valley company to get dinged off and settle costs with SEC-TechCrunch

Another Silicon Valley company settled with the SEC: online lending company Prosper, which the SEC had accused of "miscalculating and significantly exceeding annual net returns of resellers and other investors." Prosper has agreed to pay $ 3 million as part of the settlement, where it has not admitted or denied the authority's claims.

According to a new issue from the SEC: "For nearly two years, Prosper told tens of thousands of investors that their returns were higher than they actually were despite warning signs that should have warned Prosper that there was a miscalculation of these returns." The annual San Francisco-based company "excluded certain defaulted loan repayments from the calculation of annual net return" that it communicated to investors from around July 201[ads1]5 to May 2017.

The error caused a coding error that precluded the standardized loans from the calculations, the SEC said and caused Prosper to exceed its annual net returns of more than 30,000 investors on individual account pages on the site and in email addresses seeking additional investor investment.

SEC added that many investors decided to make further investments based on overloaded annual net returns and "Prosper failed to identify and correct the error despite [its] knowledge that it no longer understood how annual net returns were calculated and despite investor complaints about the calculation. "

The settlement is second for the SEC in two weeks. On April 2, the SEC announced that the founder and former CEO of Jumio had agreed to pay the agency $ 17.4 million to settle charges he deceived investors in mobile payments and identity verification startup before bankruptcy.

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