The investigation follows a May 22, 2026, announcement by Chinese regulators targeting cross-border securities activity. Reuters reported that authorities intended to penalize online brokers, specifically naming Tiger—the parent company of UP Fintech—for soliciting business within China without the required onshore licenses. This regulatory crackdown triggered a sharp market reaction, causing the firm's American Depositary Shares to plummet by more than 30% in premarket trading before closing down 25.3% for the session.

Investors who purchased securities prior to this drop are now being invited to join a potential class action lawsuit. Rosen Law Firm, which asserts a history of successful litigation against Chinese firms, is seeking to recover losses for shareholders. The firm notes that participants in the prospective class action would not be responsible for out-of-pocket legal fees, as the case is being handled under a contingency arrangement.