iLearningEngines (AILE) Faces Investor Class Action Amid Fraud Allegations

SAN FRANCISCO, Nov. 07, 2024 (GLOBE NEWSWIRE) -- A recent and critical report by a well-known activist short seller has thrown the financial stability and business practices of iLearningEngines AILE into question, leading to a class action lawsuit from investors.

The firm Hagens Berman has urged investors who have faced significant financial losses related to iLearningEngines to come forward.

Allegations of Fraud

The report from Hindenburg Research accuses iLearningEngines, a company specializing in AI-driven learning automation, of various fraudulent activities, including fabricating revenue figures and questionable accounting practices. Key points raised in the report include:

• Related Transactions: It is claimed that a considerable amount of iLearningEngines' reported revenue is funneled through a non-disclosed related party, specifically a UAE-based company called Experion Technologies.
• Misleading SEC Filings: The report states that iLearningEngines may have misled the Securities and Exchange Commission (SEC) about its ties to Experion, denying any connection despite evidence to the contrary.
• Exaggerated Revenue Figures: Concerns were raised regarding the accuracy of the company’s revenue claims, especially in India, where the actual income of its only subsidiary reportedly falls well below reported amounts.
• Auditing Concerns: Questions regarding the auditing integrity of Marcum LLP, the company's auditor, have been noted, citing past quality control issues and fines issued by the Public Company Accounting Oversight Board (PCAOB) and the SEC.

The fallout from this report has been significant, with iLearningEngines' stock price experiencing a sharp decline of over 50%.

Legal Actions and Investigations

As a result of the troubling report and the subsequent drop in share value, a class action lawsuit has been filed against iLearningEngines. This lawsuit is on behalf of investors who purchased shares between April 22 and August 28, 2024. It claims that the company's deceptive practices have resulted in financial harm to those investors.

The class action mirrors the accusations from Hindenburg, asserting that the company’s favorable public statements regarding its operations and growth prospects were misleading due to allegations of artificially inflated revenue through undisclosed transactions with a so-called "Technology Partner."

The lawsuit aims to secure compensation for investors tricked by iLearningEngines' alleged misconduct.

Investigation by Hagens Berman

Hagens Berman, a prominent firm dedicated to protecting shareholder rights, has initiated an investigation into the situation.

“Investors relying on iLearningEngines' potentially misleading statements may have suffered significant losses,” said Reed Kathrein, the partner leading the investigation.

Investors with substantial losses or information that could assist in the investigation are encouraged to report.

For additional information regarding the iLearningEngines case and the ongoing investigation, interested parties are invited to seek further details.

Whistleblower Opportunities

Individuals with non-public information about iLearningEngines are encouraged to consider their options to aid in the investigation or utilize the SEC's Whistleblower program. This newly established program offers whistleblowers the possibility of receiving a reward of up to 30% from any successful recoveries achieved by the SEC based on original information they provide. For further inquiries, Reed Kathrein can be reached directly.

About Hagens Berman

Hagens Berman is a globally recognized plaintiffs' rights litigation firm with a focus on corporate accountability. The firm represents investors, whistleblowers, employees, consumers, and others who have been harmed by corporate wrongdoing. To date, Hagens Berman has achieved recoveries exceeding $2.9 billion. More information about the firm and its accomplishments can be found on their website.

Investment, Lawsuit, Fraud