Xoom Corp (XOOM) to Write Off $30.8M; CFO Resigns

Xoom Corp (XOOM) revealed in a regulatory filing with the Securities and Exchange Commission (SEC) that it was a victim of fraud and expected to write off $30.8 million in its financial results for the fourth quarter of 2014.

Xoom does not expect material impact on its business

In its filing, the management of Xoom indicated that the criminal impersonated an employee and made a fraudulent request to its finance department that resulted in the transfer of $30.8 million in corporate cash to overseas accounts.

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Xoom said no customer data or money was involved and its systems were not impacted by the situation. “While this matter will result in some additional near-term expenses, the company does not expect this incident to otherwise have a material impact on its business,” according to the company.

Xoom authorized an independent investigation

The audit committee of Xoom authorized an independent investigation on the situation. Outside advisors will be helping in the probe.

Xoom added its audit committee and advisors are reviewing its audit controls and internal procedures as part of the investigation. The company also contacted law enforcement authorities who are actively-pursuing multi-agency criminal investigation.

Furthermore, the company explained that its disclosure of information regarding the situation will be limited to the ongoing investigation.

Xoom CFO Resigned

Xoom also announced the resignation of Matt Hibbard from his position as chief financial officer effective immediate. The company emphasized that his departure was not caused by any disagreement or dispute with the company.

Ryno Blignaut will serve as acting CFO and Chief Risk Officer. He assumed both positions in the company before.

“There are no arrangements or understandings between Mr. Blignaut and any other persons pursuant to which he was appointed as the acting Chief Financial Officer and Chief Risk Officer of the company,” according to Xoom.

Xoom also indicated that Mr. Blignaut has no family relationships with any of its directors, executive officer or any of its nominated persons to become director or executive officer.

Xoom preliminary financial results

Xoom also revealed its preliminary unaudited financial results for the fourth quarter of 2014. The company expected its revenue to be in the range of $43.1 million to $43.6 million, up by 34% to 36% from the same period in 2012. Its previous 4Q guidance was around $41 million to $43 million.

During the quarter, Xoom estimated that its active customers increased by 21% to 1.28 million. The company added 5% or 118,000 new customers during the quarter.

Xoom plans to release its complete financial results for the fourth quarter and full year 2014 after the market close on February 10, 2015.

The stock price of Xoom dropped 2.54% to $16.89 per share today.