Net 1 UEPS Technologies Inc., CEO Herman Kotze and CFO Alex Smith are facing a lawsuit filed in the United States District Court for the Southern District of New York on behalf of investors over allegations that the company made false and misleading statements and failed to disclose important information regarding financial statements.

The plaintiff alleges that the company issued a series of material or false misrepresentations to the market, which artificially inflated the market price during the class period from Sept. 12, 2018, through Nov. 8, 2018.

The complaint, filed Dec. 5, alleges that during the class period, Net 1 UEPS failed to disclose that it lacked effective internal control over financial reporting, misclassified its investment in Cell C Proprietary Ltd., and overstated its income on the company's financial statements for fiscal year 2018.

The plaintiff seeks to recover damages on behalf of all Net 1 UEPS shareholders who purchased common stock during the class period.