#United States #San Francisco #Hagens Berman #Klarna #Fair Financing

Klarna Under Investigation: A Closer Look

In a significant development concerning Klarna Group plc (NYSE KLAR), the well-respected law firm Hagens Berman has officially launched an investigation into potential violations of securities laws. This inquiry comes on the heels of Klarna's recent Q3 2025 financial results, which revealed a staggering 102% increase in the provision for credit losses. Such a dramatic spike raises serious questions about the company's disclosure practices and its transparency with investors.

Klarna, which went public at an initial offering price of $40.00 per share on September 9, 2025, has seen its stock price decline by nearly 23.6% since then. The firm’s disappointing earnings report has put its management team under scrutiny, particularly regarding their handling of the Fair Financing initiative, which appears to have significantly influenced the increased credit losses.

Reed Kathrein, the partner leading the investigation at Hagens Berman, emphasized the importance of transparency when it comes to investor relations. "When a company experiences a massive surge in its provision for credit losses, it raises concerns about whether these risks were acknowledged prior to the IPO," he stated. The investigation will examine whether Klarna adequately warned investors about the considerable risks associated with its aggressive push into the Fair Financing sector,
which reportedly saw a 139% growth during the same period.

Financial Metrics Under Examination

The investigation by Hagens Berman will center on several key aspects:

• - Provision for Credit Losses: The alarming increase of 102% year-over-year in provisions for credit losses.
• - Lending Risks: An analysis of whether Klarna's previous offerings misrepresented the lending risks associated with their Gross Merchandise Volume (GMV), particularly given that the percentage of provisions relative to GMV increased by 38% over the last 12 months.
• - Causation: Understanding how the aforementioned risk was exacerbated by the rapid growth in the Fair Financing portfolio and whether the associated risks were properly communicated to investors.

This inquiry is particularly critical for investors who've faced significant losses due to the company's recent disclosures. Hagens Berman is calling on those affected to reach out for a discussion on their rights as shareholders.

The backdrop of this scrutiny is not only limited to the performance of the stock but reflects broader implications for how tech companies manage investor expectations as they introduce new financial products. Hagens Berman has demonstrated a strong track record in advocating for corporate accountability, having secured over $2.9 billion for clients in various legal matters.

Next Steps for Investors

Investors impacted by this situation and those contemplating their legal options are encouraged to reach out to Hagens Berman’s team. Reed Kathrein can be contacted directly, highlighting that the firm is actively looking into the implications of the credit provision increases disclosed on November 18, 2025. Interested investors can submit their claims through a secure form provided on the firm’s website.

Additionally, whistleblowers with information about Klarna's internal practices are also urged to come forward, as they may assist in this important investigation and potentially benefit from the SEC Whistleblower program.

Given the complexity and the stakes involved, this investigation into Klarna is shaping up to be a pivotal moment for investors and stakeholders alike in understanding the risks associated with such high-growth financial models. The case will likely serve as a significant precedent in analyzing future securities disclosures within the evolving landscape of fintech companies and their product offerings. Investors and consumer advocates will be closely watching the developments as they unfold.