Bankrupt Loan Servicer Kabbage Sues SoftBank, Amex, Ex-Leaders

Kabbage Inc.'s bankruptcy estate sued its former leaders, major shareholders like SoftBank, and American Express Co. as part of an effort to claw back $746 million for creditors after the pandemic-era collapse of its business.

The two suits filed by the wind-down estate of Kabbage allege that its ex-leaders recklessly pursued government Paycheck Protection Program lending as both a lifeline and springboard to secure a lucrative sale to Amex but then orchestrated a merger to “orphan” the toxic loan portfolio and liabilities with what was left of Kabbage, leaving it insolvent.

Kabbage, founded in 2009, was a financial services ...