Investment Fraud Lawyer Blog

The Federal Home Loan Bank of Seattle has filed 11 lawsuits against an array of Wall Street banks, seeking rescind $4 billion of mortgage-backed securities with interest, according to a Feb. 16 Wall Street Journal article by Nick Timiraos, “Home Loan Bank Sues Wall Street Firm.” The lawsuits were filed in late December in King County Superior Court in Washington. A spokeswoman for The Federal Home Loan Bank of Seattle said the institution had "a responsibility to its member shareholders to enforce its rights."

Continue reading "Federal Home Loan Bank Sues Securities Firms to Recover Subprime Losses" »

Cellular South Inc. has filed a federal lawsuit in Mississippi against JP Morgan Securities for misrepresenting the risk and liquidity of auction rate securities, leaving $4 million in securities that it cannot liquidate. Auction rate securities are fixed-income debt instruments – typically municipal bonds, preferred shares of closed end mutual funds, or asset-backed securities collateralized by student loans or mortgages – for which the interest rate is regularly reset through an auction process. Auction rate securities were once routinely marketed as safe, cash equivalents that were highly liquid, but the broker-dealers who sold them failed to disclose that liquidity was entirely dependent upon the success of the auction process, which was being artificially supported by the undisclosed participation of brokers bidding in auctions where they had an interest. The Cellular South suit alleges that JP Morgan manipulated the market by failing to disclose that it was supporting the auctions, thereby creating the false appearance of stability and liquidity in the auction rate securities market.

Continue reading "JP Morgan Sued For Auction Rate Securities Losses" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The markets were closed on Monday for Martin Luther King Day.

• On Tuesday, the Dow Jones Industrial Average opened at 10,610 and soared 116 points.

• On Wednesday, the Dow Jones Industrial Average dropped 122 points.

• On Thursday, the Dow Jones Industrial Average fell 213 points.

• On Friday, the Dow Jones Industrial Average plunged 216 points and closed the week at 10,173.

Continue reading "Page Perry's Market Monitor - January 22, 2010" »

An Illinois-based pension fund has brought a shareholder’s derivative action seeking to recover billions of dollars in executive compensation paid by Goldman Sachs. This could be the first of many such suits, reported James Armstrong of Law360, “Goldman Pay Suit Could Signal New Wave of Litigation,” Jan. 8, 2010.

Continue reading "Institutional Investors Are Fed Up With Wall Street Pay Excesses Too" »

How short their memories. Wall Street firms on the brink of failure until rescued by a controversial taxpayer bailout continue to show their unabashed greed by claiming entitlement to massive amounts of money earned on funds "invested" by American taxpayers. Without those bailouts, most, if not all the Wall Street firms would be bankrupt or teetering on failure. Nevertheless, undeterred by the rising anger on Main Street and the populist backlash in Washington D.C., and flush with record revenues of $449.6 billion, Wall Street firms are on track to pay over $145 billion in bonuses for 2009, according to the Wall Street Journal.

Continue reading "Wall Street Firms "Thumb Their Noses" at Taxpayers and Washington Politicians - Award Obscene Bonuses Anyway" »

The first public hearings by the Financial Crisis Inquiry Commission were notable for what did not happen. The well-prepared Wall Street bankers faced the cameras with apparent humility, parried Commission clunkers with their own platitudes, and left pretty much unperturbed. Those who expected the reprise of the 1930s Pecora hearings must have been disappointed. “Pecora’s revelations enraged the public and stampeded Congress into creating the SEC and separating commercial banks from investment banks,” according to Paul Wiseman in his USA Today column, “Depression-era star muckraker shapes Wall Street inquiry.” He added: “In public hearings, Pecora squared off against the elite financiers of the age, pointing at them with his cigar and coaxing them into what [Senate historian Donald] Ritchie calls ‘startling admissions of wrongdoing.”

Continue reading "The Reason Real Change is Needed - Wall Street Maintains a Business as Usual Stance as Public Hearing Begin on the Financial Crisis" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the year at 10,428 and, on Monday, the market soared 156 points.

• On Tuesday, the Dow Jones Industrial Average dropped 12 points.

• On Wednesday, the Dow Jones Industrial Average gained 2 points.

• On Thursday, the Dow Jones Industrial Average rose 33 points.

• On Friday, the Dow Jones Industrial Average moved up 11 more points and closed the week at 10,618.

Continue reading "Page Perry's Market Monitor - January 8, 2010" »

The Wall Street Journal reports that “hundreds of businesses are fighting to recover billions of dollars tied up in frozen auction-rates securities, a year after Wall Street firms agreed to $60 billion in settlements over the collapsed market for the investments.” See “Firms Fight Banks Over Billions in Frozen Notes,” WSJ 1/2/10. While regulators stepped in to help individual investors after the auctions froze in February 2008, many corporate and institutional investors did not benefit from settlements between banks, broker-dealers and the SEC, FINRA and state attorneys general. According to Atlanta attorney Craig T. Jones, investors were left holding about $330 billion in illiquid securities when the auctions froze, so $60 billion in settlements is only a drop in the bucket.”

Continue reading "The Auction Rate Securities Debacle Continues - Corporate America Takes on Wall Street" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the week at 10,023 and, on Monday, the market soared 204 points.

• On Tuesday, the Dow Jones Industrial Average rose 20 points.

• On Wednesday, the Dow Jones Industrial Average climbed 44 more points.

• On Thursday, the Dow Jones Industrial Average fell 94 points.

• On Friday, the Dow Jones Industrial Average rebounded 73 points and closed the week at 10,270.

Continue reading "Page Perry's Market Monitor - November 13, 2009" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the week at 9,713 and, on Monday, the market jumped 77 points.

• On Tuesday, the Dow Jones Industrial Average dropped 18 points.

• On Wednesday, the Dow Jones Industrial Average rose 30 points.

• On Thursday, the Dow Jones Industrial Average surged 204 points.

• On Friday, the Dow Jones Industrial Average rose 17 points and closed the week at 10,023.

Continue reading "Page Perry's Market Monitor - November 6, 2009" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the week at 9996 and, on Monday, the market rose 96 points.

• On Tuesday, the Dow Jones Industrial Average fell 51 points.

• On Wednesday, the Dow Jones Industrial Average dropped 92 points.

• On Thursday, the Dow Jones Industrial Average moved up 132 points.

• On Friday, the Dow Jones Industrial Average sunk 109 points and closed the week at 9972.

Continue reading "Page Perry's Market Monitor - October 23, 2009" »

On September 27th, the financial press reported that William “Bill” Winters, a chief executive of JP Morgan Chase’s investment banking division, had placed much of the blame for the worldwide economic crisis on “greedy bankers.” See “Financial News: Winters Hits Out At Greedy Bankers,” posted by Harry Wilson on www.efinancialnews.com. Two days later, Jamie Dimon, chairman and chief executive of JP Morgan Chase, announced that Mr. Winters is leaving the company and will be replaced by Jes Staley, as reported by the New York Times Deal Book article, “JP Morgan Shuffles Investment Bank Management,” dated September 29, 2009.

Continue reading " Wall Street Doesn't Want to Hear the Truth - In Fact, the Truth May Get You Fired!" »

Wachovia Bank, JPMorgan and other major financial institutions have filed their second motion to dismiss a complaint brought against them by more than a dozen state and local governments alleging price-fixing and bid-rigging of municipal derivatives markets. This according to a recent article by Erin Fuchs in Law360 entitled “Banks Shoot To Kill Municipal Bond Antitrust MDL.” The MDL action, captioned In re: Municipal Derivatives Antitrust Litigation, case number 1:08-md-01950, is pending in the U. S. District Court for the Southern District of New York.

Continue reading "Wall Street Firms Want a "Free Pass" for Ripping Off State and Municipal Governments" »

The Securities Industry and Financial Markets Association, an important Wall Street lobbying group, has decided to support the Obama administration’s proposal to hold brokers to the same standard as a fiduciary when they provide investment advice, according to a recent report in The Wall Street Journal. While investors who sue their brokers have long argued, with considerable success, that a fiduciary duty arises whenever there is a relationship of trust and confidence between broker and investor, that determination is presently made on a case by case basis under laws that vary from state to state. A federal standard, which is more likely to pass now that it has been endorsed by the industry, would make it easier for investors to prevail in claims against brokers.

Continue reading "Wall Street Trade Association Supports Fiduciary Standard" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the week at 8146 and, on Monday, jumped 185 points.

• On Tuesday, the Dow Jones Industrial Average rose 28 points.

• On Wednesday, the Dow Jones Industrial Average soared 257 points.

• On Thursday, the Dow Jones Industrial Average went up 96 points.

• On Friday, the Dow Jones Industrial Average rose another 32 points and closed the week at 8744.

Continue reading "Page Perry's Market Monitor - July 17, 2009" »

The Financial Industry Regulatory Authority (“FINRA”) is requesting information from brokerage firms involved in several recent municipal bond problems, according to a July 1 article by Leslie Wayne in the New York Times. FINRA says that it is conducting these information “sweeps” with an eye toward possible investigations and disciplinary actions.

Continue reading "Regulators Investigate Fraud in the Municipal Bond Market" »

Billionaire Len Blavatnik filed a lawsuit against JPMorgan Chase this week, claiming that the investment bank had mismanaged a $1 billion investment account that held assets on behalf of Blavatnik’s company, Access Industries. The suit alleges that JPMorgan’s brokers invested the company’s assets in risky, illiquid real estate securities that were inconsistent with the conservative investment objectives of the company, causing $98 million in losses that would not have occurred had the money been properly invested.

Continue reading "JPMorgan Sued for Sale of High Risk, Illiquid Real Estate Investments" »

On May 13, 2009, the U.S. Securities and Exchange Commission (“SEC”) approved a rule change that requires brokers to disclose alleged sales practice violations made by a customer against a securities broker in the body of a civil lawsuit or arbitration claim, even if that broker is not named as a defendant or respondent. The SEC received a total of 1,654 comment letters on the proposed rule change. Approximately 1,451 of the letters were “form letters” from financial advisors and insurance agents (who sell insurance products such as variable annuities) opposing the change.

Continue reading "Regulators Require Financial Firms to Provide More Public Disclosure Regarding Customer Complaints" »

There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:

• The Dow Jones Industrial Average opened the week at 8131 and, on Monday, plunged 290 points.

• On Tuesday, the Dow Jones Industrial Average bounced back 128 points.

• On Wednesday, the Dow Jones Industrial Average fell 83 points.

• On Thursday, the Dow Jones Industrial Average rose 70 points.

• On Friday, the Dow Jones Industrial Average jumped 119 points and closed the week at 8076.

Continue reading "Page Perry's Market Monitor - April 24, 2009" »

Washington is doing far too little to strengthen the government’s ability to investigate and prosecute the type of corporate and mortgage fraud that led to the economic collapse, The New York Times opined in an Editorial dated April 18, 2009. The Times points out that focus has shifted away from financial fraud to anti-terrorist activities, and that this has resulted in fewer fraud investigators to police the huge infusion of federal money into the economy.

Continue reading "Corporate Fraud Needs to be a Government Priority " »