Whitney Tilson on his short position in World Acceptance. Excerpted from an email sent to investors.
So great to see! One of my few remaining shorts – and I’ve been adding to it such that it’s a 2.6% position. Down ~24% after hours…
On August 7, 2015, the Company received a letter from the CFPB’s Enforcement Office notifying the Company that, in accordance with the CFPB’s discretionary Notice and Opportunity to Respond and Advise (“NORA”) process, the staff of CFPB’s Enforcement Office is considering recommending that the CFPB take legal action against the Company (the “NORA Letter”). The NORA Letter states that the staff of the CFPB’s Enforcement Office expects to allege that the Company violated the Consumer Financial Protection Act of 2010, 12 U.S.C. §5536. The NORA Letter confirms that the Company has the opportunity to make a NORA submission, which is a written statement setting forth any reasons of law or policy why the Company believes the CFPB should not take legal action against it. The Company understands that a NORA Letter is intended to ensure that potential subjects of enforcement actions have the opportunity to present their positions to the CFPB before an enforcement action is recommended or commenced. The Company intends to make a NORA submission to the CFPB’s Enforcement Office.
Whitney Tilson: World Acceptance Falls As CFPB Expects To Bring Charges
World Acceptance skids after saying it notified regulators expect to bring civil charges
NEW YORK (AP) -- Shares of payday lender World Acceptance dropped in aftermarket trading Monday after the company said the Consumer Financial Protection Bureau expects to bring civil charges against it.
World Acceptance said the CFPB's enforcement unit expects to allege that the company violated the Consumer Financial Protection Act of 2010. World Acceptance says it believes its marketing and lending practices are legal and that it will have an opportunity to argue that the CFPB shouldn't take action against it.
The CFPB has been investigating World Acceptance's marketing, offering and extension of credit for more than a year.
World Acceptance Corp. stock plunged $12.52, or 24 percent, to $39.28 in aftermarket trading.
Shares of the Greenville, South Carolina-based company have dropped 35 percent in 2015 through the close of regular-session trading Monday.