Law and Regulations

DOJ sends grand jury subpoena to LendingClub following CEO ouster

DOJ sends subpoena to LendingClub

LendingClub has revealed it received a federal grand jury subpoena last week, after the resignation of its founder and CEO Renaud Laplanche.

Laplanche's departure followed an internal review of lending and financial practices. LendingClub said it planned to cooperate with the U.S. Department of Justice and Securities and Exchange Commission.

"The DOJ and the SEC may have additional requests, and no assurance can be given as to the timing or outcome of these matters," LendingClub said in a filing on Monday.

LendingClub found that roughly $22 million in loans sold to a single investor this year failed to meet the investor's requirements. It added that Laplanche had failed to disclose that he pledged some of his shares to secure a third-party personal loan.

Crisis at LendingClub

The peer-to-peer lending company went public in 2014.

LendingClub's shares dropped as much as 10 percent in after-hours trading. The stock has plunged 64 percent this year.