Did you lose money investing in ECMOHO Ltd based on your financial advisor’s recommendation? The securities attorneys at The White Law Group may be able to help you pursue recovery through a FINRA arbitration claim against your brokerage firm.
(Note: Investors should check the most recent share price, as it may have changed since this report.)
What is ECOMOHO Ltd?
Ecmoho (NASDAQ: MOHO), founded in 2011 and headquartered in Shanghai, is a comprehensive health service provider of health and wellness market, focused on providing brands with smart retail, global marketing, customer service, technical warehousing and fulfillment, etc. In 2014, the company reportedly became first-tier player in China’s cross-border healthcare e-commerce business, providing one-stop cross-border services for many international brands. The company was listed on NASDAQ in 2019.
In August 2021, ECMOHO Ltd. offered shares of its common stock for sale to investors. The offering was reportedly underwritten by Aegis Capital Corp. As of February 28, 2024, the average post offering return was –98.6%. The company’s common stock was traded on the NASDAQ, under the symbol “MOHO.”
As of December 23, 2022, the SEC posted this Notice of Termination by a Foreign Private Issuer of a class of equity securities under Section 12(b) filing.
Risks Associated with Small Stock Offerings
There are numerous risks involved in investing in small stock offerings, including the following, among others:
Liquidity Concerns: These stocks may have low trading volumes, making it difficult to buy or sell shares at desired prices.
Lack of Information: Many small companies may not provide comprehensive financial disclosures or have limited operating histories.
Market Volatility: Small stocks can be more volatile than larger, established companies, leading to significant price fluctuations.
Broker Due Diligence
Broker due diligence is a process undertaken by brokerage firms to ensure they are recommending and selling investment products appropriate for their clients. This process protects the interests of the brokerage firm and its clients by ensuring that the investments offered are suitable for the client’s investment objectives, risk tolerance, and financial situation.
If a broker or brokerage firm makes an unsuitable investment recommendation or fails to disclose the associated risks adequately, they may be found liable for investment losses in a FINRA arbitration claim. Fortunately, FINRA provides an arbitration forum for investors to resolve such disputes.
Class Action vs. Individual FINRA Arbitration Lawsuit
You may wonder whether a large class action lawsuit is a better litigation option than an individual FINRA arbitration case. The answer depends on many factors, but typically if the loss sustained is large (say larger than $100,000), an individual arbitration claim is likely a better option. Class actions as a recovery option are more appropriate for grouping large numbers of individuals who have small claims – too small to generally pursue individually.
Free Consultation
If you have suffered investment losses in ECMOHO Ltd., you may have recovery options. The securities attorneys at The White Law Group offer free consultations and can be reached at 1-888-637-5510.
About The White Law Group
The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Seattle, Washington. The firm represents investors across the country in claims against their brokerage firms.
FAQs – ECMOHO Ltd.
1. Why is ECMOHO Ltd. under investigation?
The White Law Group is investigating whether brokerage firms improperly recommended investments in ECMOHO Ltd. (NASDAQ: MOHO) to investors. The company’s stock, underwritten by Aegis Capital Corp., has declined approximately 98.6% since its August 2021 offering, raising concerns about whether brokers conducted adequate due diligence or disclosed the high risks involved.
2. Why is investing in companies like ECMOHO Ltd. risky?
Small-cap stocks like ECMOHO often involve significant risks, including low liquidity, limited financial transparency, and extreme market volatility. ECMOHO was delisted from NASDAQ in 2022 after significant financial decline. These types of investments may not be suitable for conservative or income-focused investors.
3. Can I recover losses from investing in ECMOHO Ltd.?
If your broker failed to properly evaluate your financial situation or did not explain the risks of investing in ECMOHO Ltd., you may be able to recover your losses through a FINRA arbitration claim. The White Law Group offers free consultations to determine if you have a valid case.
