An investigation on behalf of investors of Net 1 UEPS Technologies, Inc. (NASDAQ: UEPS) shares over potential securities laws violations by Net 1 UEPS Technologies, Inc. and certain of its directors and officers in connection with certain financial statements was announced.

The investigation by a law firm focuses on possible claims on behalf of purchasers of the securities of Net 1 UEPS Technologies, Inc. (NASDAQ: UEPS) concerning whether a series of statements by Net 1 UEPS Technologies, Inc. (NASDAQ: UEPS regarding its business, its prospects and its operations were materially false and misleading at the time they were made.

South Africa based Net 1 UEPS Technologies, Inc. provides transaction processing services, financial inclusion products and services, and secure payment technologies in South Africa, the Republic of Korea, and internationally. Net 1 UEPS Technologies, Inc. reported that its Total Revenue rose from $610.06 million for the 12 months period that ended on June 30, 2017 to $612.88 millin for the 12 months period that ended on June 30, 2018 and that its Net Income over those time periods declined from $72.95 million to $39.15 million.

On November 8, 2018, Net 1 UEPS Technologies, Inc disclosed 'that the Company's consolidated financial statements for the year ended June 30, 2018, included in the Company's Annual Report on Form 10-K for the year ended June 30, 2018, should be restated, and that such consolidated financial statements and Deloitte & Touche (South Africa)'s audit report thereon should no longer be relied upon, due to the Company's re-evaluation of the classification of its investment in Cell C Proprietary Limited ('Cell C').' The Company further disclosed that its 'investment [in Cell C] was incorrectly presented as available-for-sale and the change in its fair value of $25.2 million, net of taxation of $7.3 million, was incorrectly recorded in other comprehensive income for the year ended June 30, 2018.' Net 1 UEPS Technologies, Inc explained that it 'incorrectly used the guidance in ASC 320 Investments-Debt and Equity Securities regarding available-for-sale equity instruments with readily determinable fair values. Cell C's equity securities are not listed on an exchange and therefore there are no sales prices or bid-and-asked quotations that are currently available on a securities exchange, and therefore it did not meet the scope requirements of an equity security under ASC 320. As a result, the investment was incorrectly classified as an available-for-sale equity instrument with the changes in fair value being incorrectly recorded as part of other comprehensive income rather than through earnings.'

Shares of Net 1 UEPS Technologies, Inc. (NASDAQ: UEPS) declined to as low as $4.43 per share on November 9, 2018.