Netcapital Inc. Faces Class Action Lawsuit Over Alleged Financial Fraud and Sham Revenues

Key Facts

1A class action lawsuit has been filed against Netcapital Inc. on behalf of investors who purchased shares between December 2021 and September 2026.

2The complaint alleges the company recognized material revenues from sham consulting agreements with entities controlled by defendant John Fanning.

3The lead plaintiff deadline for the lawsuit has been set for December 7, 2026.

A class action lawsuit has been filed against Netcapital Inc. on behalf of investors who purchased shares between December 2021 and September 2026. GlobeNewswire reported that the complaint alleges the company recognized material revenues from sham consulting agreements with entities controlled by defendant John Fanning. The court has set a deadline of December 7, 2026, for investors to move for lead plaintiff status.

The allegations include the use of backdated or forged consulting agreements to inflate financial results, violating the Sarbanes-Oxley Act. NCPL closed at $1.39 on October 13, 2026, having traded between a day high of $1.68 and a day low of $1.21. These legal proceedings follow concerns regarding undisclosed related party transactions that impacted the company's reported revenue.