A Look at the Details
B. Riley Financial, Inc. RILY experienced a 7% drop in shares on Thursday after The Bear Cave released a report. In response, B. Riley provided a detailed rebuttal to address each of the allegations. Let’s delve into the specifics.
Allegation 1: Departure of Audit Engagement Partner
The Bear Cave report suggested that James LaRocca, the audit engagement partner at Marcum LLP, may have departed from the firm. B. Riley countered by stating, “B. Riley continues to work with its auditors,” subtly dismissing the implication.
Allegation 2: Double Pledged Collateral
Furthermore, the report raised concerns about the collateral underpinning B. Riley’s $201 million loan to Brian Kahn, alleging double pledging. B. Riley vehemently refuted this claim, stating, “A simple UCC search refutes any notion that these shares were double pledged.”
Allegation 3: Concerns about B. Riley
The report also alleged that Marcum harbored “numerous concerns about B.Riley” and engaged outside legal counsel regarding regulatory matters. B. Riley characterized these allegations as “clear and transparent market manipulation,” vehemently addressing the implications made by the report.
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Market Reaction
RILY Price Action: B. Riley shares took a hit, declining by 2.80% to $17.18 at the time of publication, according to Benzinga Pro.
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