Velocity Financial Investors Sue Over Loan Performance, IPO

Velocity Financial Inc. allegedly misled investors about the performance and accrual status of its loans ahead of its January initial public offering, according to a complaint filed in federal court in California.

The mortgage firm didn’t disclose that, by the time the IPO took place, the number of non-performing loans had “dramatically increased” from what was represented in Velocity’s offering documents, the would-be class complaint, filed Wednesday in the U.S. District Court for the Central District of California, said.

Velocity also “failed to provide any information to investors regarding the potential impact of the novel coronavirus” on its business, ...