The Securities and Exchange Commission is examining whether Better.com violated federal securities laws. Federal securities regulators have requested documents from Better.com and its blank check company Aurora Acquisition Corp. about their business activities, the companies said in filings with the SEC. They also are seeking information about the business activities of Better.com Chief Executive Vishal Garg and allegations made by former executive Sarah Pierce. Pierce alleged in a lawsuit last month that the company misled investors in financial filings and other representations it made as it attempted to go public. Ms. Pierce was Better.com’s former executive vice president for sales and operations. Better.com said at the time that Ms. Pierce’s claims were without merit and it would vigorously defend the lawsuit.
In its filing, the company said it was cooperating with the SEC. Better.com said in a statement that it voluntarily provided all materials requested and that it was “happy to set a high bar for transparency and responsiveness.” Better.com was a winner amid 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 year and weeks later said it planned to go public at a valuation of $7 billion.
Better.com since has been struggling by the rise in interest rates and resulting pullback in refinancing, as well as a controversial move in December in which Mr. Garg laid off 900 workers via a Zoom call. The company shed about 7,500 jobs, or 72% of its total workforce, between the end of last year and May.
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