Law
Offices of Howard G. Smith announces that a class action lawsuit has
been filed in the United States District Court for the Southern District
of New York on behalf of all purchasers of the securities of Prospect
Capital Corporation (“Prospect” or the “Company”) (NASDAQ:PSEC) between
August 21, 2013 and May 6, 2014, inclusive (the “Class Period”).
Prospect is a financial services company that primarily lends to and
invests in middle-market privately held companies. The Complaint alleges
that, throughout the Class Period, defendants misrepresented and/or
failed to disclose that:
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Certain of Prospect’s wholly owned companies were investment companies
for accounting purposes that were required to be consolidated by the
Company.
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Certain of Prospect’s wholly owned holding companies should have been
accounted for as investment companies.
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The Company’s reported investment income and financial results were
misstated.
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The Company’s internal and financial controls were inadequate.
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The Company’s financial statements were materially false and
misleading at all relevant times.
On May 6, 2014, the Company disclosed that the staff of the Securities
and Exchange Commission has asserted that certain of Prospect’s wholly
owned companies are investment companies for accounting purposes and
must be consolidated. The Company further disclosed that it may need to
restate its prior financial statements to resolve the issue, and that
one potential effect of a restatement would be to decrease the Company’s
historical net investment income by the amount of interest and
structuring income paid by such wholly owned companies in excess of the
amount of income that may be reported as dividend income based on
taxable earnings and profits.
If you are a member of the Class described above, you have until July
28, 2014, to move the Court to serve as lead plaintiff, if you meet
certain legal requirements. To be a member of the Class you need not
take any action at this time; you may retain counsel of your choice or
take no action and remain an absent member of the Class. If you wish to
learn more about this action, please contact Howard G. Smith, Esquire,
of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112,
Bensalem, Pennsylvania 19020 by telephone at (215) 638-4847, Toll Free
at (888) 638-4847, or by email to howardsmith@howardsmithlaw.com,
or visit our website at http://www.howardsmithlaw.com.
Copyright Business Wire 2014