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id: 455

DLocal (DLO) Multiple Fraud Investigations Case

E.D. New York
Case number
02 May 2022
Class period Start
25 May 2023
Class period End
05 Dec 2023
Lead Plaintiff motion deadline
  • In December 2022, Muddy Waters' reports concluded that DLocal is "likely a fraud." In May 2023, Argentine started an investigation for a possible DLO $400M fraud.
  • $DLO fell dramatically, injuring shareholders., who suspect now DLocal of multiple misconducts leading to investor losses.
On May 26, 2023, Argentine news outlet Infobae published an article reporting that the Argentine government was investigating DLocal for a possible $400 million fraud related to “improper maneuvers” and transfers abroad, with unnamed sources alleging that DLocal “operates as a mere instrument to take advantage of the exchange rate gap and to take dollars abroad with operations that are not reflected in the accounting.”

On this news, $DLO fell over 17%, damaging investors.

Earlier, on April 5, 2023, DLocal released Q4 2022 financial results, reporting diluted earnings per share of $0.06 on total revenue of $118 million, missing analyst estimates. On this news, $DLO fell 26%.

On December 1, 2022, Muddy Waters published a report stating that DLocal has held calls with clients from several banks, stressing that it had separated client funds from its own. The report also said that DLocal’s calls with clients were "non-specific" and "sweet-talking," and that "all [the Company] needed to do to address this issue was provide an explanation as to how the cash flows reconcile." On this news, DLocal’s share price fell 15.1%.

On November 16, 2023, Muddy Waters issued a report critical of DLocal (DLO), concluding that the Company is "likely a fraud."
  • the Short Seller Fund alleged that DLocal disclosures "flatly contradict one another" and said there is a "contradictory discrepancy between two key subsidiaries' accounts payable and accounts receivable."
  • Muddy Waters sees "signs of cooked books" and said it has concerns about DLocal's controls to protect client funds.
On this news, DLO shares dropped over 50% and the Company lost more than $1.7 billion of its capitalization.

Going back in June 2021, Dlocal conducted a successful IPO, with the shares nearly doubling in its initial months, but DLO stock has fallen below its offering price in recent months.

Managers and directors sold about $1 billion worth of DLocal shares within the first five months of the Company being public and said there have been a number of high-level departures, factors that Muddy Waters says "brings to mind the idiom about 'rats fleeing a sinking ship.'"

DLocal commented on Mundy Water's Report: "The report contains numerous inaccurate statements, groundless claims, and speculation. Short seller reports are often designed to drive the stock price downwards to serve the short seller’s interests to the detriment of the company’s shareholders. We caution shareholders from making investment decisions based on this report. Dlocal will rebut the allegations in the appropriate forum in due course."

Considering all facts and research, Investors have reasons to suspect that their rights were grossly violated by the Company and its Leaders.
Case Status
Lead Plaintiff Appointed
Alleged Offence
Misleading Statements
Financial Misrepresentation
Failure to Disclose
Suspected Party
Security Type
Trade Direction
Shock Event Date
26 May 2023
Filing date
06 October 2023
Lead Plaintiff Deadline
05 December 2023
Collecting participants…

Dlocal Ltd

DLocal Limited operates a payment processing platform worldwide. Its payments platform enables merchants to get paid and to make payments online. The company serves commerce, streaming, ride-hailin...

    Software - Infrastructure
    Dr. Luis Bonavita 1294, Montevideo, Uruguay, 11300