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JFU.US
id: 2092

9F ($JFU) Investor Settlement

The parties have reached an agreement to settle the case, but the terms are still being finalized. You can submit your application now, and it will be processed once claims filing opens.
D. New Jersey
Court
2:21-cv-00948
Case number
10/14/2019
Class period Start
09/29/2020
Class period End
9F has reached a tentative settlement to resolve investor claims tied to its arrangement with PICC, allegedly disguised borrower fees, and the later revenue fallout when that arrangement broke down.

Outline:

Before August 2019, 9F’s lending business was a major part of the company even as Chinese rules tightened around borrower fees. Around April 2019, 9F worked with PICC on a structure that used insurance premiums to continue collecting loan-facilitation fees while presenting borrowing costs as compliant with legal limits, but the arrangement later collapsed when PICC disputed it, withheld funds, and triggered a sharp revenue decline.

Timeline:
  • April 2, 2019: China tightened rules prohibiting loan-facilitation institutions from collecting borrower fees.
  • August 14, 2019: 9F’s IPO registration became effective.
  • June 12, 2020: 9F disclosed that PICC had withheld RMB 2.2 billion and challenged the agreement’s validity.
  • June 24, 2020: 9F disclosed that PICC had collected all loan-facilitation fees from borrowers and remitted 9F’s share.
  • September 29, 2020: 9F reported a sharp revenue decline linked to the PICC dispute.
Background:

9F operated an online lending platform in China and earned loan-facilitation fees from helping borrowers obtain loans.

Before the IPO, Chinese regulators tightened restrictions on lending intermediaries. The new rules limited total borrowing costs and restricted how companies like 9F could collect fees from borrowers.

Investors point to 9F’s arrangement with PICC, under which loan-facilitation fees were allegedly collected through insurance premiums. They also argue that some borrowers continued to pay total borrowing costs above the 36% limit despite the company’s statements regarding compliance.

The arrangement later broke down. In June 2020, 9F disclosed that PICC had withheld RMB 2.2 billion in service fees and challenged the agreement. The company later acknowledged that PICC had collected all loan-facilitation fees from borrowers and remitted 9F’s share.

Investors argued that those disclosures revealed risks in 9F’s business model and the revenue impact that followed.

What Can Investors Expect Now?

9F has reached a tentative settlement to resolve investor claims tied to its arrangement with PICC, borrower fees collected through insurance premiums, and the revenue fallout that followed when the arrangement broke down.

If you were damaged due to this situation, you can file for a payout and get your share of the settlement.
Case Type
US Securities Class Action
Case Status
Tentative Settlement
Alleged Offence
Misleading Statements, 
Financial Misrepresentation, 
Fraud, 
Failure to Disclose
Suspected Party
Directors, 
Management
Security Type
Depository Securities (ADS, ADR, GDR)
Trade Direction
Long
Filing date
01/20/2021
Plaintiffs
John S. Wait ; Delanta L. Harrison
Attorneys
Glancy Prongay & Murray LLP
Defendants
Lei Sun ; Yanjun Lin
Trades matching type
FIFO

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