Blink Charging (NASDAQ:BLNK), a provider of EV charging services and equipment, saw its stock price rocket higher amid a recent avalanche of new deals and sales channel expansion. However, the initiation of a new securities fraud lawsuit against the company is now inducing a bloodbath in the stock.
The matter came to a head yesterday as Culper Research published a damning report against Blink Charging, alleging that:
“We believe that the Company has vastly exaggerated the size of its EV charging network in order to siphon money from the pockets of investors to insiders. Blink claims that “EV drivers can easily charge at any of its 15,000 charging stations,” but we estimate the Company’s functional public charging station network consists of just 2,192 stations, a mere 15% of this claim.”
The report goes on to note:
"Our on-the-ground visits to 242 stations at 88 locations across the U.S. revealed a plethora of neglected, abused, non-functional, or otherwise missing chargers. Our analysis of the Company’s own data suggests that the average charger is utilized for just 6 to 38 minutes per day (0.39% to 2.65% utilization), while annual charging revenue of a mere $6.37 per member suggests that the average Blink member doesn’t even obtain one single full charge from the Blink network over the course of an entire year. We think that even at 20x current utilization, Blink’s network would continue to incinerate cash. In sum, Blink vastly overstates the size, functionality, usage, and economic potential of its chargers.”
While commenting on the implications of these “vastly exaggerated” claims, Culper believes that Blink Charging has committed securities fraud by building a Ponzi scheme, whereby, minority investors are exploited to benefit the insiders. As evidence, Culper asserts that Blink’s compensation expenses total $44 million since 2014. On the other hand, the company’s cumulative revenue amounts to only $18 million during this period. Moreover, Culper believes that the Chairman and CEO of Blink Charging, Michael D. Farkas, played a pivotal role in perpetrating this alleged fraud.
These allegations have now become the focal point of a securities fraud investigation by Block & Leviton LLP, a national securities litigation firm. In a press statement, the firm has asked existing Blink Charging shareholders to contact its attorneys:
“If you purchased or acquired shares of Blink Charging and have questions about your legal rights or possess information relevant to this matter, please contact Block & Leviton attorneys at (617) 398-5600, via email at cases@blockleviton.com , or at https://www.blockleviton.com/cases/blink.”
Blink Charging shares are currently down over 15 percent, trading at $7.97 price level:
Ever since peaking at $12.60 on the 5th of August, Blink Charging shares are down over 36 percent, based on the current stock price.
The post Blink Charging (NASDAQ: BLNK) Shares Tank Amid Looming Litigation Regarding the Company’s “Vastly Exaggerated” EV Charging Infrastructure Claims by Rohail Saleem appeared first on Wccftech.
Refference- https://wccftech.com
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