Secret recordings by an employee of AmTrust’s former auditor BDO USA LLP are the latest news impacting AmTrust. According to The Wall Street Journal, those recordings were made as part of a federal investigation of a whistleblower claim being led by the SEC. The whistleblower claim alleges that AmTrust shifted $277 million to an offshore affiliate between 2009 and 2012, bolstering AmTrust’s operating income by that amount. The Journal cited a person familiar with the matter who reported that The New York Department of Financial Services is conducting a special, non-routine examination of AmTrust’s New York unit. Amtrust’s stock price was down sharply on the news.
Previously, on February 27, 2017, AmTrust issued a press release revealing that it had identified material weaknesses in its internal control over financial reporting that existed as of December 31, 2016. On this news, shares of AmTrust fell $5.32 per share or over 19% to close at $22.34 per share on February 27, 2017.
Then, in early April, 2017, AmTrust restated its financial results downward back to 2014 over a range of accounting issues, trimming more than 9% off of AmTrust’s previously reported net income for the past three years. AmTrust also announced that it replaced BDO as its outside auditor.
A class action lawsuit was recently filed against AmTrust. Investors who wish to serve as lead plaintiff must move the Court no later than May 1, 2017. If you wish to join the litigation, please contact Paul Scarlato at (484) 342-0700 or by email at [email protected].
