Ecmoho Limited

Kurta Law is investigating broker recommendations of Ecmoho Limited. These investments have a high degree of risk and may have been unsuitable for many investors. If you have suffered losses, our securities offer free case evaluations and have excellent experience representing victims of broker fraud or misconduct. Call (877) 600-0098 or email info@kurtalawfirm.com for a free case evaluation.  

What is Ecmoho Limited?  

According to the prospectus, Ecmoho Limited is an “integrated solution provider in China’s rapidly growing non-medical health and wellness market.”  

The Offering  

In the prospectus dated August 3, 2021, Ecmoho Limited announced an offering of 10,000,000 American Depository Shares (ADS). American Depository Shares are shares of a foreign-based company that are available on an American stock exchange.   

Risks Related to Shares of Ecmoho Limited 

The prospectus discloses a variety of risks. Investors should know that the following risks were clearly disclosed in the prospectus, and any broker knew or should have known that these investments were high risk.  

Covid-19 Pandemic Concerns  

Covid-19 created global and industry-wide challenges. The Chinese government has imposed a variety of quarantines and travel restrictions since the onset of the pandemic. Third-party business providers were not able to meet obligations due to work absences during the first quarter of March 2020. It is impossible to predict if similar circumstances will affect Ecmoho Limited.  

Uncertainty Surrounding the Wellness Industry in China  

If the e-commerce market or the health and wellness industry does not grow or does not grow as Ecmoho Limited expected, the company may be adversely affected. Additionally, changes to governmental policies and taxation pose considerable risk.  

Laws Concerning Cybersecurity and Data Protection  

Ecmoho Limited is subject to a variety of laws concerning cybersecurity and data protection. Failure to comply with applicable laws may result in significant fines or other penalties.  

Competition  

There is no guarantee that Ecmoho Limited would be able to compete with e-commerce companies that have better resources, or with new entrants to the health and wellness market.  

Additional Capital  

At the time of the prospectus filing, Ecmoho Limited disclosed that it may need additional capital to fund its inventory. There was no guarantee that Ecmoho Limited would be able to find capital with acceptable terms, or that it would be able to obtain capital at all.  

Aegis Capital Corp. Underwriting    

Investors should know that Aegis Capital Corp. served as the underwriter for this offering. Underwriters take on risk in exchange for a fee, which could motivate certain investment banks to underwrite investments that pose too much risk for the average retail investor. Additionally, brokers may have conflicts of interest when they recommend shares that are underwritten by an affiliate of their brokerage firm. 

Kurta Law Can Help  

Many investors who want to sue their brokerage firms discover that their investment contracts contain pre-dispute arbitration clauses. These clauses require investors to go through a process called FINRA arbitration rather than suing in civil court. FINRA arbitration and securities regulations are niche areas of law, and investors may benefit from having an experienced securities attorney on their side. Our attorneys work hard to ensure a fair and timely resolution to their client’s claims.  

If you would like to discuss your case further, contact us today. Call (877) 600-0098 or email info@kurtalawfirm.com. Our attorneys do not collect a fee unless we win your case.