The legal action focuses on whether PicS accurately represented its internal credit controls and expected credit losses at the time of its market debut. According to the complaint, internal assessments conducted in December 2025 identified deficiencies in the firm's credit evaluation processes. These findings allegedly triggered a reclassification of approximately R$590 million in financial exposures from Stage 2 to Stage 3, leading to an incremental charge of R$88 million for the final quarter of 2025.

Furthermore, the lawsuit points to a sharp, undisclosed rise in default rates. While the company's IPO documentation suggested stability, the complaint alleges that the rate of new contracts entering Stage 3 default jumped from 3.8% in the third quarter of 2025 to over 7% by the end of the year. This trend continued into 2026, with the company’s Q1 results showing a 13% spike in Stage 3 loans. Hagens Berman partner Reed Kathrein stated that the firm is investigating whether the IPO documents were negligently prepared by failing to disclose these adverse trends in the company's credit quality.