Faruqi & Faruqi, LLP Investigates Potential Securities Claims Against AMMO, Inc.

Investigation Alert: Unfolding Claims Against AMMO, Inc.

Faruqi & Faruqi, LLP, a nationally recognized securities law firm, has recently initiated an investigation focusing on allegations directed at AMMO, Inc. (NASDAQ: POWW). Investors who have incurred losses exceeding $50,000 in AMMO during the timeframe from August 19, 2020, to September 24, 2024, are particularly encouraged to connect with the firm to explore their legal options.

Allegations In Detail

The primary allegations suggest that AMMO and its executives violated numerous federal securities laws by issuing false and misleading statements and failing to disclose critical information. These failures involve:
1. Insufficient internal controls regarding financial reporting;
2. A significant possibility that the disclosures regarding executive officers, management members, and related party transactions during fiscal years 2020 through 2023 were lacking;
3. Mischaracterization of fees related to investor relations and legal services as proceeds reductions from capital raises rather than as expenses for fiscal years 2021 and 2022;
4. Incorrect valuation of unrestricted stock awards given to officers, directors, employees, and other parties between fiscal years 2020 and 2022;
5. Consequently, misrepresenting the company's operational status and future prospects, misleading investors about the security's valuation.

AMMO’s Response and Market Reaction

In a recent statement on September 24, 2024, after market close, AMMO declared the resignation of its Chief Financial Officer at the Board's request. This announcement coincided with disclosures of an independent inquiry into the company’s internal controls concerning financial reporting for the fiscal years 2020 through 2023. The ongoing investigation aims to evaluate whether the previous management adhered to accurate disclosure policies regarding executive roles and financial obligations during those years.

The following trading day, shares of AMMO plummeted by $0.08, marking a 5.26% decline to close at $1.44 per share, alongside unusually elevated trading volumes, reflecting investor concern and skepticism surrounding the company's integrity.

Steps for Affected Investors

For those interested in their rights, the court looks to appoint a lead plaintiff – typically the investor with the most significant financial stake who represents the putative class in court. Investors may move to serve as lead plaintiff or can opt to remain passive, accepting a share of any settlement reached. It's crucial for affected investors to make informed decisions on whether to participate actively or remain a class member.

Faruqi & Faruqi, LLP also extends an invitation to individuals possessing insights into AMMO’s operations, including whistleblowers and former employees, to come forward.

Conclusion

Faruqi & Faruqi, LLP is poised to play a significant role in this unfolding saga, supporting investors affected and claiming their rights amidst the turbulence facing AMMO, Inc. Interested individuals can obtain more details regarding the class action suit by visiting the firm's website or contacting their office directly at 877-247-4292 or 212-983-9330 (Ext. 1310). This situation sheds light on the critical need for transparency and accountability in corporate practices, particularly in the arena of federally regulated securities.

This case serves as a reminder of the importance for investors to stay vigilant and informed about the companies they trust with their capital investments. As developments continue, updates will be shared through various channels, including LinkedIn, X, and Facebook.