B. Riley fails to file audited results
B. Riley Financial Inc., the boutique investment bank under attack from short sellers about its dealings with a former business partner, failed to file its audited results after an extension period ended.
The company continues to work with its auditors as it seeks to complete and file its annual report “as soon as reasonably practicable,” it said in a statement Friday afternoon.
Shares in the bank were down about 6% as of 5:30 p.m. Friday in New York, after falling about 16% year to date.
A representative for the bank declined to comment beyond the statement.
The delay has added to pressure on B. Riley, whose stock has been battered by concerns about its relationship with Brian Kahn, the founder of Franchise Group Inc. B. Riley helped Kahn arrange a buyout of Franchise Group, lent money to Kahn and used some of his assets to help back a loan that B. Riley obtained from Nomura Holdings Inc.
B. Riley missed the initial deadline for filing its annual report and attributed the delay in a Feb. 29 disclosure to the board’s review of the firm’s transactions with Kahn. He was labeled as an unidentified co-conspirator in a Department of Justice criminal case prompted by the 2020 collapse of the Prophecy Asset Management hedge fund, Bloomberg News previously reported.
Kahn has categorically denied any wrongdoing and said he was among those who lost money when Prophecy collapsed. Riley has said it had no knowledge of what happened at Prophecy and wasn’t involved with the hedge fund.
The Securities and Exchange Commission gives companies a customary 15-day extension to file overdue reports. B. Riley missed last year’s initial deadline too, citing recent acquisitions, but was able to finish the job within the grace period. The
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