Investigation into ALT5 Sigma: Hagens Berman Raises Concerns Over Possible Disclosure Issues

ALT5 Sigma Faces Scrutiny from Hagens Berman

The national law firm Hagens Berman has taken action to investigate ALT5 Sigma Corporation (NASDAQ: ALTS) due to alarming signs of financial instability and a potential breakdown in governance, which prompted a staggering 80% drop in the stock price. This investigation emerges from recent disclosures that suggest the company may have misled investors about its financial reporting stability and internal control mechanisms, particularly surrounding its substantial $1.5 billion registered offering made in August 2025.

Decline and Crisis in Governance

Hagens Berman's efforts are specifically focused on the repercussions of ALT5's failure to timely file its third-quarter report. This omission has resulted in a Nasdaq Non-Compliance Notice issued on December 2, 2025. Compounding these issues are serious allegations against a subsidiary of ALT5, which is embroiled in a criminal case concerning illicit enrichment and money laundering activities, as well as a significant overhaul of management, which includes the dismissal of both the CEO and CFO.

"One of the most troubling elements of this situation is the potential misalignment between the resignation timeline of the auditor and the suspension of the CEO," said Reed Kathrein, a partner at the firm leading the investigation. The alleged failure to disclose these events in a timely manner, along with the full purge of management and the subsidiary's conviction, points toward significant systemic failures in corporate governance.

Details of the Investigation

The investigation will explore possible violations of federal disclosure requirements that may indicate further issues in the company’s internal controls, especially following its substantial capital raise.

Auditor Disclosure Issues

According to Form 8-K, a company must announce the resignation of its independent auditor within four business days of the event. ALT5 Sigma reported the resignation of its auditor, William Hudgens, effective November 21, 2025, but Forbes has indicated that he provided notice to the company of his intention to resign substantially earlier. If the company was indeed informed of Hudgens's departure months before the official report, it raises questions as to why it waited until late November to release this information.

Concealment of CEO Suspension

In a similar vein, Form 8-K stipulates that companies must report executive changes, such as suspensions, within a four-day timeframe. ALT5 disclosed CEO Peter Tassiopoulos's suspension on October 16, 2025; however, reports suggest that he had been on leave as early as September 4. This significantly delayed disclosure could reflect poorly on the company's governance framework.

Governance Breakdown

Further scrutiny reveals a complete governance collapse, with both the CEO and CFO having been terminated and the Audit Committee Chair resigning shortly before the Nasdaq Non-Compliance Notice. The main issue at hand revolves around the undisclosed criminal judgment pertaining to the subsidiary, raising significant concerns over financial reporting accuracy and the company’s adherence to Generally Accepted Accounting Principles (GAAP).

Taking Action

Hagens Berman is recognized for its proficiency in addressing complex securities fraud cases, affording them a pivotal position in representing investors impacted by these troubling developments surrounding ALT5. Investors who have incurred losses linked to ALT5 shares are encouraged to reach out to the firm promptly as investigations continue to unfold.

For those with insights or information regarding ALT5 Sigma, the firm is also highlighting potential whistleblower opportunities under SEC guidelines, which could reward individuals who disclose relevant details with a cut of any successful financial recovery.

For more details, investors are recommended to visit Hagens Berman’s Site or contact Reed Kathrein directly at 844-916-0895.

Hagens Berman's long history of advocating for corporate accountability ensures that they are well-equipped to provide expertise during this complex financial crisis. Their commitment extends beyond just litigation, aiming to restore integrity and confidence in corporate governance standards.