According to the Complaint, Tenet Fintech Group Inc. purports to be the parent company of a group of innovative financial technology (“fintech”) subsidiaries operating in China’s commercial lending industry.
On September 9, 2021, Tenet Fintech’s shares began trading on the NASDAQ exchange under the ticker symbol “TNT”. Immediately prior to market open on September 30, 2021, Tenet Fintech’s shares were delisted from the NASDAQ exchange and resumed trading OTC under the ticker symbol “PKKFF”. On October 27, 2021, the Company officially changed its name from Peak Fintech Group Inc. to Tenet Fintech Group Inc.
The Complaint alleges Defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose adverse facts pertaining to the Company’s business, operational and financial results, which were known to Defendants or recklessly disregarded by them. Specifically, the Complaint alleges Defendants made false and/or misleading statements and/or failed to disclose that: (1) Tenet Fintech did not own 51% of Asia Synergy Financial Capital Ltd. (“ASFC”) through Wuxi Aorong; (2) Tenet Fintech did not disclose its actual ownership structure of ASFC, an undisclosed and potentially problematic nominee shareholder agreement; (3) Huayan did not own the Heartbeat platform; (4) the Heartbeat platform did not exist prior to the alleged acquisition; (5) Tenet Fintech faced imminent delisting from NASDAQ due to non-compliance with known regulations; (6) the “recent disclosure guidance” was in fact published on November 23, 2020, nearly a full nine months prior to Tenet Fintech’s uplisting; (7) as such, Tenet Fintech knew or should have known that its 40-F submission was deficient; (8) Cubeler historically failed to make even minimum loan repayments to Tenet Fintech; (9) Tenet Fintech, instead of exercising its right on the assets, decided to purchase Cubeler; (10) in light of the foregoing, and in consideration of the fact that Cubeler is owned by several Tenet Fintech insiders, the Company’s acquisition of Cubeler is not based on legitimate business interests; (11) there is no evidence Huayan ever owned the Heartbeat platform or that it transferred the asset to Huike; (12) the largest ASFC shareholder had his shares frozen due to court sanctions; and (13) the creation of ASFC itself was likely a related-party transaction. When the true details entered the market, the lawsuit claims that investors suffered damages.