Ostin Technology Investors Seek to Recover Losses from Alleged Fraud

Robbins LLP Investigating Pump-and-Dump Scheme That Defrauded Investors

Published on Mar. 2, 2026

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Robbins LLP has filed a class action lawsuit on behalf of investors who purchased Ostin Technology Group Co., Ltd. (NASDAQ: OST) ordinary shares between May 11, 2025 and June 26, 2025. The lawsuit alleges that Ostin Technology's co-CEO Lai Kui Sen and financial advisor Yan Zhao orchestrated a fraudulent scheme that artificially inflated the company's stock price from $0.78 to $9.40 before crashing over 94% in a single day, causing over $950 million in losses for investors.

Why it matters

This case highlights the risks investors face from alleged pump-and-dump schemes, where company insiders manipulate stock prices through false promotions and non-bona fide securities offerings to enrich themselves at the expense of public shareholders. The collapse of Ostin Technology's stock price raises concerns about the oversight and regulation of small-cap companies traded on major exchanges.

The details

According to the complaint, Lai Kui Sen and Yan Zhao, along with at least 15 co-conspirators, engineered a fraudulent sequence of securities offerings to place the majority of OST shares in the hands of the co-conspirators for pennies or no consideration. They then launched a promotional campaign to artificially inflate the stock price and trading volume through social media and messaging apps, including paid promotions impersonating investment professionals. As the stock price rose from $0.78 to a peak of $9.40, the co-conspirators sold their shares, causing the stock to plummet over 94% in a single day and wiping out over $950 million in market value.

  • The class period is from May 11, 2025 to June 26, 2025.
  • On September 12, 2025, the U.S. Department of Justice unsealed a criminal indictment charging Lai Kui Sen and Yan Zhao with conspiracy to commit securities fraud, wire fraud, and securities fraud.
  • Shareholders have until April 17, 2026 to submit papers to the court to serve as lead plaintiff in the class action.

The players

Ostin Technology Group Co., Ltd.

A manufacturer of thin-film transistor liquid crystal display (TFT-LCD) modules and polarizers used in consumer electronics, commercial LCD displays, and automotive displays.

Lai Kui Sen

The co-Chief Executive Officer of Ostin Technology Group Co., Ltd., who was charged by the U.S. Department of Justice with conspiracy to commit securities fraud, wire fraud, and securities fraud.

Yan Zhao

A financial advisor who was charged by the U.S. Department of Justice with conspiracy to commit securities fraud, wire fraud, and securities fraud along with Lai Kui Sen.

Robbins LLP

A law firm that has filed a class action lawsuit on behalf of Ostin Technology Group Co., Ltd. investors who lost money during the alleged pump-and-dump scheme.

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What’s next

Shareholders who wish to serve as lead plaintiff for the class must submit their papers to the court by April 17, 2026.

The takeaway

This case highlights the importance of regulatory oversight and investor protections against alleged pump-and-dump schemes that can devastate the portfolios of retail investors. It serves as a cautionary tale about the risks of investing in small-cap companies with questionable corporate governance and financial practices.