We published yesterday that Credit Corp Group Limited (ASX: CCP) had entered a trading halt after the publication of a anonymous report by вЂCheckmate Research’. After the business’s reaction, and its own come back to trade today, the Credit Corp share cost has dropped 12% to $16.64.
I became delivered a duplicate for the 37-page report yesterday night by Motley Fool analyst Ed Vesely. Take note that many of this allegations within the report have already been refused by Credit Corp as wrong & most of the report is simply viewpoint.
Nevertheless, with its report, Checkmate contends that:
- Credit Corp’s primary company is a payday lender that is avoiding category as a payday loan provider via its utilization of a loophole that is legal
- Avoiding category as a payday loan provider presumably brings regulatory or financing advantages to Credit Corp
- Credit Corp’s bank Westpac Banking Corp(ASX: WBC) has cut financing with other payday loan providers like Cash Converters Overseas Ltd(ASX: CCV) and Money3 Corporation Limited(ASX: MNY)
- Checkmate says that Westpac should stop using the services of Credit Corp, just as so it has along with other payday loan providers
- Checkmate accuses Credit Corp of so-called вЂearnings administration’ because of its too smooth profit that is gross, considering the fact that alterations in the business enterprise never have led to a substantial improvement in margins within the last several years
- Checkmate says that Credit Corp may be worth ten dollars a share in the place of its last price that is traded of18.84
There was a lot to protect in just about any one article вЂ“ 37 pages worth вЂ“ thus I will attempt to summarise the details. (more…)