A former senior executive at Better.com alleged in a lawsuit that the online mortgage lender misled investors in financial filings and other representations it made as it attempts to go public, the Wall Street Journal reported. Sarah Pierce, Better.com’s former executive vice president for sales and operations, alleged in the suit that Chief Executive Vishal Garg and the company misrepresented Better.com’s business and prospects to keep investors onboard with a planned merger with a special-purpose acquisition company, or SPAC. The deal was agreed to in May 2021 and has yet to close. Ms. Pierce said in the suit that she was pushed out of her role at the company in February in retaliation for raising these issues. She has also filed a complaint alleging retaliation with the Occupational Safety and Health Administration under the Sarbanes-Oxley Act, according to a footnote in the suit. Better.com was a major winner of the boom in housing prices and mortgage refinancing that accompanied the pandemic and low interest rates. The company grew revenue nearly 10-fold to $876 million in 2020 from the year prior, posted a profit of $172 million and hired thousands as it rushed to keep up with the market, company filings said. It raised $500 million from SoftBank Group Corp. last spring and weeks later said it planned to go public at a valuation of $7 billion. Better.com has since been rocked by the rise in interest rates and resulting sharp pullback in refinancings and a highly publicized controversy when Mr. Garg laid off 900 workers via a Zoom call in December. He took a brief leave after the call sparked an uproar. The company has laid off thousands more as the market for SPAC deals has also cooled.
