FTAI Aviation Ltd. (NASDAQ: FTAI) Shares Fall On Second Muddy Waters Report Raising Questions About Possible Violations of U.S. Sanctions Against Iran, Securities Class Action Pending – Hagens Berman

/EIN News/ -- SAN FRANCISCO, March 10, 2025 (GLOBE NEWSWIRE) -- FTAI Aviation Ltd. (NASDAQ: FTAI) saw its shares slump on March 3, 2025 after Muddy Waters Research published a report alleging the company may be violating U.S. sanctions against Iran. A securities class action lawsuit, captioned Shannahan v. FTAI Aviation Ltd. et al., No. 1:25-cv-00541 (S.D.N.Y.) has previously been filed. The suit seeks to represent investors who purchased FTAI securities between July 23, 2024 and January 15, 2025.

Hagens Berman’s investigation into the claims is ongoing and the firm urges FTAI Aviation investors who suffered substantial losses to submit your losses now.

Class Period: July 23, 2024 – Jan. 15, 2025
Lead Plaintiff Deadline: Mar. 18, 2025
Visit: www.hbsslaw.com/investor-fraud/ftai
Contact the Firm Now:	FTAI@hbsslaw.com
	844-916-0895

The Second Muddy Waters Report

In the latest development, on March 3, 2025, Muddy Waters Research published another report titled “FTAI Could Be Violating U.S. Sanctions Against Iran.” Muddy Waters reviewed images posted on LinkedIn from within Sorena Turbine, an aircraft Maintenance, Repair & Overhaul (“MRO”) company located in Tehran, observed an FTAI module factory branded box prominently within the shop, and noted “[i]t’s unclear to us whether this was a one-off or part of a pattern of widespread prohibited conduct.

The Initial Muddy Waters Report and the Snowcap Report

The initial Muddy Waters report, released January 15th, triggered a 24% plunge in FTAI's stock price and prompted the internal review.

Muddy Waters, based on an investigation that included a former FTAI executive and other industry insiders, alleged that FTAI has been improperly classifying one-time engine sales as MRO revenue within its Aerospace Products segment. The firm contends this practice inflates Aerospace Products revenue, creating a misleading growth narrative that has benefited insider selling. Muddy Waters estimates the majority of FTAI’s adjusted EBITDA in the segment derives from less recurring gains on sales and alleges the company engaged in channel stuffing to inflate 2023 results.

On Jan. 21, 2025, FTAI announced that its Audit Committee had commenced a review into the Muddy Waters allegations and that its Annual Report may be delayed. This news caused a 23% decline in the price of FTAI Aviation stock.

Snowcap Research subsequently amplified these concerns on January 29th, claiming its own three-month investigation corroborated many of Muddy Waters’ conclusions. Snowcap described FTAI’s Aerospace segment as “in substance an elaborate fabrication” and stated it spoke with former FTAI executives, industry experts, and competitors who expressed confusion regarding the company’s accounting and disclosures.

FTAI’s Audit Committee, after a review conducted by independent legal and forensic accounting advisors, concluded the short-seller claims lacked foundation, the company said. “After a thorough and comprehensive review…we have determined that the assertions…are unsupported and have no merit,” stated Paul R. Goodwin, Audit Committee Chair. Despite this assertion, FTAI’s statement notably refrained from addressing the granular details of Muddy Waters’ and Snowcap Research’s allegations.

The FTAI Investor Class Action

The suit echoes Muddy Waters’ claims in its January 15^th report and alleges that FTAI made false and misleading statements and failed to disclose the following crucial information:

• Reported one-time engine sales as MRO revenue when it performs only limited repair and maintenance work on the engine assets sold;
• Presents whole engine sales as individual module sales, thereby overstating sales and demand; and
• Depreciates engines that are not on lease, which misleadingly lowers the cost of goods sold and inflates EBITDA.
  

If you invested in FTAI and have substantial losses, or have knowledge that may assist the firm’s investigation, submit your losses now »

If you’d like more information and answers to frequently asked questions about the FTAI case and our investigation, read more »

Whistleblowers: Persons with non-public information regarding FTAI should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email FTAI@hbsslaw.com.

About Hagens Berman
Hagens Berman is a global plaintiffs’ rights complex litigation firm focusing on corporate accountability. The firm is home to a robust practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and other wrongdoings. Hagens Berman’s team has secured more than $2.9 billion in this area of law. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw. 

Contact:
Reed Kathrein, 844-916-0895