Securities Fraud Lawsuit Filed Against Kyndryl
The Schall Law Firm has reminded investors of a class action lawsuit against Kyndryl Holdings, Inc. The lawsuit alleges violations of the Securities Exchange Act. Investors in the company (NYSE: KD) are being given the opportunity to lead the securities fraud case.
- The class-action lawsuit covers investors who purchased Kyndryl securities between August 7, 2024, and February 9, 2026. The lead plaintiff deadline for investors to file with the court is April 13, 2026. - Allegations in the lawsuit claim that Kyndryl made false or misleading statements and failed to disclose that its financial statements were materially misstated. The suit also alleges the company had inadequate internal controls. - The lawsuit names CEO and Chairman Martin J. Schroeter, former CFO David B. Wyshner, and former Senior Vice President and Principal Accounting Officer Vineet Khurana as defendants. - On February 9, 2026, Kyndryl announced it could not timely file its quarterly report for the period ending December 31, 2025, due to an internal review of its cash management practices. This review followed voluntary document requests from the SEC's Division of Enforcement. - The same day, Kyndryl announced the immediate departures of its Chief Financial Officer and General Counsel. The company also anticipated reporting "material weaknesses" in its internal controls over financial reporting. - Following these announcements, Kyndryl's stock price plummeted by 55% in a single day, dropping from a closing price of $23.49 on February 8, 2026, to $10.59 on February 9, 2026. - Kyndryl was spun off from IBM's infrastructure services business and began trading as an independent public company on the New York Stock Exchange on November 4, 2021. At the time of the spin-off, it had approximately 4,400 customers, including 75% of the Fortune 100. - Despite the ongoing issues, Kyndryl has stated that its financial position remains strong and that there will be no restatement of current or previously reported financial statements. The company is now implementing a remediation plan to address the identified weaknesses in its internal controls.
