Risk & Compliance

Xoom CFO Resigns As Firm Discloses $30M Fraud

Alongside a criminal investigation, Xoom's audit committee has authorized an independent investigation that will review the company's internal cont...
Matthew HellerJanuary 7, 2015
Xoom CFO Resigns As Firm Discloses $30M Fraud

Money transfer company Xoom Corp. has disclosed that $30.8 million in corporate cash was fraudulently transferred to overseas accounts and that CFO Matt Hibbard has resigned after only one month on the job.

Xooming-in-at-the-Money-Transfer-BusinessAccording to a regulatory filing, the company determined last week that it had been the victim of a “criminal fraud” involving “employee impersonation and fraudulent requests targeting the company’s finance department.” As a result, Xoom expects to record a one-time charge of $30.8 million in its results for the fourth quarter 2014.

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Federal law enforcement authorities “are actively pursuing a multi-agency criminal investigation,” Xoom said, also disclosing that its audit committee has authorized an independent investigation that will review the company’s internal controls.

“The company believes that no customer data was involved [in the theft] nor was any customer’s money involved in this matter and the company’s systems were not impacted,” it said.

In the same report to the U.S. Securities and Exchange Commission, Xoom announced that Hibbard had resigned Jan. 5, effective immediately, and will be replaced by former CFO Ryno Blignaut.

“Mr. Hibbard’s resignation is not the result of any disagreement or dispute with the company,” it said.

Hibbard, formerly vice president of finance, had only taken over as CFO on Dec. 1 after Blignaut left Xoom to pursue other interests.

Since Monday’s SEC filing, Xoom’s stock has dropped as much as 10% to $16.01. In trading Wednesday, it was down 1% at $16.65.

Xoom will report its fourth-quarter and 2014 results on Feb. 10. It expects revenue to range between $43.1 million and $43.6 million for the quarter, which is up from its previous forecast of $41 million to $43 million.

In the wake of the fraud disclosure, several law firms have announced that they are investigating “whether Xoom and certain of its officers and/or directors” violated securities laws.