Forbes made a strong claim against Kylie Jenner, her net worth, and business.
Allegedly, the supposed youngest self-made billionaire falsified her tax returns and other legal documents. Now, Coty Inc., which partly owns Kylie Cosmetics, is, reportedly, under investigation for possible "violations of federal securities laws."
According to Cosmetic Business, Coty Inc. faces a probe by different law firms, The Schall Law Firm, Federman & Sherwood, and Rosen Law Firm, on behalf of its shareholders. This happened after Forbes exposé. Allegedly, Kylie Jenner faked her billionaire status and provided a "misleading financial date" about the value of her cosmetics company.
The investigation Coty Inc. faces
Business Wire reported that Federman & Sherwood's investigation focused on disclosures made by Coty. It would investigate if any of its officers and/or directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
In November 2019, the company announced its plan to buy more than half of Kylie Cosmetics’ shares. Kylie Jenner's makeup business gave it a good deal, a 51% stake for $600 million.
By the time they announced the plan, Coty's stock dramatically increased by six percent. However, the multinational beauty company's shares started to decline after Forbes' report on May 29.
"Coty paid up for a ‘high-growth’ brand that is actually a much smaller business than it was just a few years ago," Forbes wrote. The publication also claimed that Kylie Cosmetics was "never that big to begin with.”
KarJenners are, allegedly, lying about its success since 2016. There was also a possibility that even its tax returns were altered.
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oops not supposed to be showing you guys the new cozy skims
Kylie Cosmetics CEO's sudden resignation
After the controversial revelation, news emerged that Kylie Beauty Brands' CEO, Christophe Honnefelder, stepped down from his role, although he never officially assumed the post, People reported. After Coty and Kylie Cosmetics' deal, the former announced Honnefelder as the new CEO of Kylie Beauty brands.
He was only an incoming CEO and would assume the role "in the near future." Now, Coty announced that Honnefelder resigned from his post due to some "personal reasons."
“Coty announced a number of changes that will allow the company to focus on its core Prestige and Mass Beauty businesses, including renewed investment in the e-commerce development of the Prestige Beauty franchise," the company said in an announcement. "As part of this effort, we are building a strong foundation to support our strategic partnership with Kylie Jenner."
Coty now names Simona Cattaneo as the new head of Kylie Cosmetics, per New York Post.
Featured image used courtesy of Tinseltown/Shutterstock