SoFi Technologies SOFI
SOFI's silence on 11 specific accounting questions confirms Muddy Waters' view that 2025 Adjusted EBITDA is inflated ~90% via mislabeled financings, hidden debt, and misstated risk retention.
Thesis
Muddy Waters is short SOFI and on March 17, 2026 published a 28-page report concluding SOFI's 2025 Adjusted EBITDA is inflated by roughly 90%. This follow-up note documents months of attempted engagement culminating in eleven specific questions sent to CFO Chris Lapointe — none of which SOFI has answered. The questions probe whether a $312M Q3 2024 'sale' of Secured Loans to SoFi Funding PL VI LLC was actually a JPMorgan-financed intra-group borrowing missing from Note 9, whether Skyfi loan sales were seller-financed (invalidating the ~106% marks as market validation), and whether SOFI's claimed vertical risk retention on SCLP securitizations is in fact 100% horizontal Class R retention — which would defeat true-sale accounting under ASC 860 and ASC 810. Muddy Waters argues the silence, the General Counsel's deflection toward identifying their pseudonym, and CEO Noto's token $500K stock purchase against $58.3M in prepaid forward extractions all confirm management was caught red-handed.
SCQA
SoFi Technologies is a consumer lender whose 2025 Adjusted EBITDA Muddy Waters argues is inflated ~90% through mislabeled loan sales, undisclosed JPMorgan borrowings, and misstated securitization risk retention.
After months of engagement and 11 specific factual questions, SOFI refused to respond — the General Counsel instead demanded Muddy Waters disclose its pseudonym, suggesting management knows the facts are damaging.
SOFI must answer each of the 11 questions with single specific verifiable statements; independent directors should retain counsel and investigate; auditor Deloitte must reassess whether prior financials can be relied upon.
Confirming the unrecorded $312M JPMorgan debt, seller-financed loan sales, and horizontal risk retention would force a restatement, potentially trigger Deloitte's resignation, and validate the short thesis on SOFI's reported earnings.
The three reasons
- 1
SOFI's 2025 Adjusted EBITDA is inflated by approximately 90%
- 2
$312M Q3 2024 secured loan 'sale' appears to be JPMorgan-financed borrowing missing from the balance sheet
- 3
SOFI claims vertical risk retention but presale reports show 100% horizontal Class R retention
Primary demands
- SOFI must answer the 11 specific questions about accounting for Secured Loan sales, LPB economics, and risk retention
- Independent directors should retain own counsel and conduct a real investigation
- Auditor Deloitte should reassess whether prior financials can be relied upon and consider requiring a restatement
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Precedents cited
- NMC Health plc (Muddy Waters' own prior fraud exposure)
Notable slides (4)
Notes
Short-seller follow-up note, not the primary 28-page report (which was published March 17, 2026). Document is structured as: (I) engagement timeline, (II) the 11 unanswered questions in a two-column 'Question / Why It Matters' table, (III) interpretation of management silence with peer institutional-ownership exhibit, (IV) next steps addressed to board and auditor Deloitte. Author byline is firm-only ('Muddy Waters, LLC') though the firm is associated with Carson Block; no individual signature in this doc, so author_name left null. Document dated both March 21 (header) and March 22 (cover) — used cover date.