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Published June 14, 2025
Compass Holdings promised investors Lugano would shine like a diamond – only it was dull like a rock. After Compass revealed it had major problems with its internal controls and Lugano’s accounting had lost its sparkle, investors found Compass’ shares lost their shine. Shareholders raced for the exists and Compass’ stock price collapsed 62% in just a day. Now investors are suing.
Compass is a holding company for a number of brands, including Lugano Diamonds. Throughout 2024, Compass executives repeatedly told investors and analysts that Lugano was the crown jewel in Compass’ portfolio, with Lugano putting up big earnings and massive margins. Maybe.
That story came crashing down in May 2025, after Compass admitted it had major problems with its financial statements and investors could no longer rely on those documents. Worse? There were serious irregularities in Lugano’s inventory and accounting. That same day, Lugano’s CEO resigned and Compass announced a delay in its SEC filings.
Once investors hearing this news, they knew Compass had lost its way and dumped their shares. Now, more investors are joining the lawsuit.