The Securities and Exchange Commission is examining mortgage lender Better.com and the special purpose acquisition company it has agreed to merge with, Aurora Acquisition Corp., to determine if they’ve violated federal securities laws, amid litigation against Better.com and its controversial CEO alleging fraud and other corporate governance problems.
Better and Aurora received “voluntary requests” for documents in the second quarter of this year, Aurora disclosed in an SEC filing Thursday.
Aurora said the companies are cooperating with the SEC, which asked for documents about Better’s business and operations, actions taken by CEO Vishal Garg and complaints against Garg and Better raised in a lawsuit by former head of sales and operations Sarah Pierce.
Pierce, who left Better in February, sued the company on June 7 alleging it misled investors in previous financial filings in its attempt to go public and retaliated against her for speaking out against Barg’s handling of a mass layoff in December 2021, among other complaints.
That winter, Garg fired 900 people—or 9% of the company’s workforce—over Zoom, one day after announcing a $750 million investment into Better and shortly before calling the departed workers “lazy” on social media.
Garg had multiple legal liabilities, conflicts of interest and corporate governance problems for years before the company placed him on a brief leave shortly after the layoffs, according to corporate disclosures filed by Better.
“We believe it’s a routine request for information, not an inquiry,” a Better spokesperson told Forbes of the SEC probe.
Better has asserted that Pierce’s claims were “without merit” and intends to “vigorously defend” the lawsuit.
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