#United States #San Francisco #Hagens Berman #Klarna Group #IPO Misstatements

Hagens Berman Launches Investigation into Klarna Group's Securities Class Action

In recent developments, the national shareholder rights law firm, Hagens Berman, is notifying investors of an ongoing investigation into Klarna Group plc (NYSE: KLAR) amidst allegations of significant disclosures in their IPO documents. Investors who purchased shares during the Initial Public Offering in September 2025 are particularly affected, as they have suffered notable financial losses since that time.

Understanding the Situation

The investigation centers on claims that Klarna's IPO documents misleadingly presented the company's credit modeling performance, concealing substantial risks associated with lending practices. Specifically, it is alleged that the company has been extending credit to financially vulnerable consumers—some even for non-essential items such as fast food deliveries—without properly disclosing these practices in their investment materials.

On November 18, 2025, following the IPO, Klarna publicly announced a shocking 102% year-over-year increase in its provision for credit losses, which sent the company's shares tumbling. Previously trading at around $40, the stock fell drastically below this figure, raising crucial doubts about the transparency of Klarna's financial disclosures.

Main Allegations Behind the Investigation

Hagens Berman is scrutinizing several key points regarding the alleged improprieties:

1. Understated Credit Risks: The lawsuit contends that Klarna's offering documents significantly downplayed the risks associated with lending to clients who were financially less informed and facing hardships. Such practices not only reflect poor credit risk assessment but also potentially exploit vulnerable consumers.

2. High-Interest Loans for Basic Goods: Allegations have been made that a significant portion of Klarna's growth stemmed from granting high-frequency and high-interest loans for non-durable goods. Critics argue that targeting financially unstable individuals with such loans poses an elevated risk for defaults, which should have been disclosed to investors.

3. Dramatic Credit Loss Spike: The increase in credit loss provisions by over 102% raises alarms regarding the reliability of Klarna’s previously advertised robust credit modeling. Investors are now questioning the legitimacy of the assurances provided during the IPO about the company's financial health.

Next Steps for Affected Investors

For those who participated in Klarna's IPO and have experienced losses, Hagens Berman urges affected shareholders to come forward. The deadline for serving as a lead plaintiff in this ongoing securities class action is set for February 20, 2026. Proper legal representation can be crucial in a situation like this, where investor rights must be protected.

Anyone interested in pursuing claims related to their losses can reach out to Reed Kathrein, a partner at Hagens Berman. They are committed to ensuring that investors have the opportunity to assert their rights in a transparent and informative manner.

Those with further information regarding non-public details about Klarna’s lending practices or IPO process are also encouraged to come forward. Hagens Berman can protect whistleblowers who may provide essential evidence or insights into the investigation.

In conclusion, the unfolding saga around Klarna Group serves as a powerful reminder of the importance of transparency in financial disclosures, especially during IPOs. The coming months will be crucial as both investors and legal practitioners navigate the aftermath of Klarna’s controversial venture into public markets.