Notice to Pension Funds, Asset Managers, and Fiduciaries: Futu Holdings' Undisclosed CSRC Regulatory Exposure Allegedly Inflated Portfolio Valuations by Billions in Client Assets

NEW YORK, July 15, 2026 /PRNewswire/ -- Institutional investors holding positions in Futu Holdings Limited (NASDAQ: FUTU) during the period from May 24, 2023 through May 27, 2026 may wish to evaluate lead plaintiff opportunities in a pending securities class action. Request an institutional investor loss assessment. You may also contact Joseph E. Levi, Esq. at jlevi@levikorsinsky.com or (212) 363-7500.

Futu ADSs fell $34.10 per share, a decline of 27.5%, on May 22, 2026, after Reuters reported a CSRC crackdown on brokers illegally channeling money to foreign markets and Futu disclosed a proposed penalty of RMB 1.85 billion (approximately USD 271 million). The window to apply for lead plaintiff closes on August 25, 2026.

Fiduciary Obligations and Recovery Options

Institutional holders with fiduciary responsibilities to beneficiaries should consider the following:

• Fiduciaries who held FUTU ADSs during the Class Period have an obligation to evaluate whether recovery options exist for plan participants or fund beneficiaries harmed by the alleged fraud
• The lead plaintiff role provides direct oversight of litigation strategy, settlement negotiations, and counsel selection, offering institutional investors a mechanism to protect beneficiary interests
• Serving as lead plaintiff carries no additional financial risk; securities class actions proceed on a contingency basis with no out-of-pocket costs to the class representative
• Pension funds, endowments, and asset managers with documented losses during the Class Period are well-positioned candidates given the PSLRA's preference for plaintiffs with the largest financial interest
• Institutional investors that fail to evaluate lead plaintiff standing may face questions from beneficiaries about whether all available recovery avenues were pursued
• Portfolio managers who relied on Futu's reported growth in total client assets and paying clients when making allocation decisions may have been harmed by the alleged overstatement of the Company's financial health

Contact us for institutional recovery options or call (212) 363-7500.

Portfolio Impact Assessment

The complaint contends Futu continued to conduct securities, public fund sales, and futures business in mainland China without the required licenses or regulatory approval throughout the Class Period. Because Futu reported consistent growth in paying clients, total client assets, and revenues derived in part from these allegedly unlicensed operations, institutional portfolios that held FUTU ADSs were allegedly exposed to undisclosed regulatory risk that materialized as a proposed penalty exceeding a quarter of a billion U.S. dollars. The resulting share price correction reduced Futu's market capitalization by billions in a single trading session.

ERISA and Fiduciary Considerations

For ERISA-governed plans that held FUTU ADSs, plan fiduciaries should assess whether the plan's investment in Futu securities was consistent with prudent investment standards given the regulatory risks that allegedly existed but were not disclosed. Retirement plans and public pension systems that included FUTU in their portfolios may have exposure warranting independent evaluation.

"Institutional investors play a critical role in securities class actions. Their participation as lead plaintiffs ensures that large-scale shareholder recoveries are pursued with the resources and sophistication the process demands." -- Joseph E. Levi, Esq.

Case Summary

A securities class action asserts that Futu and certain officers made materially misleading statements by failing to disclose the Company's ongoing non-compliance with CSRC requirements. As alleged, the Company's rectification measures were insufficient, and executives knew or should have known that significant regulatory penalties were a foreseeable consequence of operating without requisite Chinese regulatory licenses. When the CSRC's proposed RMB 1.85 billion penalty was revealed on May 22, 2026, and the financial impact was quantified in Q1 2026 results on May 28, 2026, institutional and retail shareholders suffered substantial losses.

INSTITUTIONAL INVESTOR REPRESENTATION — Levi & Korsinsky, LLP provides sophisticated counsel to institutional investors evaluating lead plaintiff opportunities. The firm has recovered hundreds of millions of dollars. Ranked among ISS Top 50 for seven consecutive years. Attorney Advertising. Prior results do not guarantee similar outcomes.

Frequently Asked Questions About the FUTU Lawsuit

Q: Who is eligible to join the FUTU investor lawsuit? A: Investors who purchased FUTU stock or securities between May 24, 2023 and May 27, 2026 and suffered financial losses may be eligible. Eligibility is based on purchase date and documented losses, not on whether you still hold the shares.

Q: How much did FUTU stock drop? A: Shares fell approximately 27.5%, a decline of $34.10 per share, after Futu disclosed receipt of a CSRC Notification Letter proposing a penalty of RMB 1.85 billion. A subsequent 4.8% decline followed the Q1 2026 earnings release quantifying the penalty's financial impact.

Q: What do FUTU investors need to do right now? A: Gather brokerage records including purchase dates, share quantities, and prices paid. Contact Levi & Korsinsky for a free, no-obligation evaluation at jlevi@levikorsinsky.com or (212) 363-7500. No immediate action is required to remain eligible as a class member.

Q: What is a lead plaintiff and why does it matter? A: A lead plaintiff is the investor appointed by the court to represent the entire class. Lead plaintiffs are typically investors with the largest documented losses. Being appointed does not increase individual recovery but gives direct oversight of how the case is run.

Q: What does it cost me to participate? A: Nothing. Securities class actions are handled on a pure contingency basis. No upfront fees, no retainer, no out-of-pocket costs.

Q: What if I already sold my FUTU shares -- can I still recover losses? A: Yes. Eligibility is based on when you purchased, not whether you still hold them. Investors who bought during the class period and sold at a loss may still participate.

Q: Can I join a different law firm's lawsuit instead? A: Multiple firms often file competing complaints. The court consolidates and appoints a single lead counsel. Contacting Levi & Korsinsky before August 25, 2026 ensures your losses are considered.

CONTACT:\

Levi & Korsinsky, LLP\

Joseph E. Levi, Esq.\

Ed Korsinsky, Esq.\

33 Whitehall Street, 27th Floor\

New York, NY 10004\

jlevi@levikorsinsky.com\

Tel: (212) 363-7500\

Fax: (212) 363-7171

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SOURCE Levi & Korsinsky, LLP