Brian Kha, a client of B. Riley, is involved in a fraud case resulting in B. Riley being interviewed by the SEC.
Due to the issue, B. Riley’s shares have decreased by 21% in premarket trading. (Photo: InvestmentNews)
B. Riley’s Association With Khan
The U.S. Securities & Exchange Commission has interviewed B. Riley regarding its association with Kahn, who is implicated in a securities fraud case. The investigation centers on Khan, who is associated with B. Riley, and their role in the buyout of Franchise Group, using some of his assets as collateral.
According to a published article by SmartNews, Nomura, one of B. Riley’s main lenders, is also under scrutiny. However, B. Riley denies any knowledge of the SEC investigation and dismisses the allegations as unfounded.
Furthermore, the SEC’s Los Angeles office is looking into the transactions between B. Riley and Bebe Stores Inc., a women’s clothing chain linked to Kahn.
Brian Khan’s Linkage To A Criminal Case
In a published article by DailyCoin, the investigation focuses on B. Riley’s involvement with a client named Brian Kahn. Brian Khan is linked to a criminal case involving the collapse of the Prophecy Asset Management hedge fund in 2020.
The U.S. Securities & Exchange Commission is particularly interested in Khan’s role in a buyout of Franchise Group Inc. in 2023, where his assets were reportedly used as collateral for the deal.
As a result of this issue involving B. Riley, B. Riley’s shares have declined by almost 21% in premarket trading.
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