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Published on: January 19, 2012

Veolia Environment S.A. Investors May Have Claim

In the United States District Court for the Southern District Court of New York, a class action has been filed against Veolia Environment S.A. on behalf of its purchasers. The class action is regarding American Depositary Shares (ADSs) for the Class Period of April 27, 2007 through August 4, 2011. Veolia Environment S.A. allegedly violated federal securities laws.

Veolia Environment S.A. Investors may have Claim

According to the complaint, Veolia failed to disclose and/or misrepresented the following facts:
• The company was engaging in improper accounting practices and as a result materially overstated its financial results.
• Veolia could not determine its true financial condition as a result of its inadequate internal controls.
• The company did not record, in a timely manner, an impairment charge for its marine services business in the United States and Southern Europe, environmental services business in Egypt and transport business in Morocco.
• The renewal of some major concession contracts was hampering the company’s revenues.

When the company’s half-year results were announced on August 4, 2011, for the period ending June 30th of that year, Veolia American Depository Shares fell by 22 percent, or $4.66 per share as a result. The shares closed at $16.10 per share. The half-year results showed a consolidated revenue of EUR 16,286.7 million. In addition, defendants reported the operating income for Veolia to be EUR 252.2 million, a significant decline compared to the prior year which had an operating income of EUR 1,100.7 million. The change was due to “non-recurring write-downs amounting to EUR 686M (principally in Italy, Morocco and the United States).” Veolia also stated that it would exit businesses and geographies including for its marine services business in the United States and Southern Europe, environmental services business in Egypt and transport business in Morocco.

Published on: January 18, 2012

SEC Warning: Social Media Fraud

by InvestorLawyers

The Securities and Exchange Commission (SEC) has issued two investor alerts regarding the use of social media sites as a means for perpetuating investment fraud. Investors who have been the victims of fraud through social media are encouraged to seek the council of an investment attorney to find out about their legal rights and options for recovering their losses.

SEC Warning: Social Media Fraud

On January 4, 2012, the SEC charged an Anthony Fields with offering to sell fictitious securities. The Illinois-based investment adviser “offered more than $500 billion in fictitious securities through various social media websites,” according to an SEC press release. Fields’ two sole proprietorships are Anthony Fields & Associates (AFA) and Platinum Securities Brokers. “Fields provided false and misleading information concerning AFA’s assets under managements, clients, and operational history to the public through its website and in SEC filings.”

Furthermore, Fields claimed to be a broker-dealer but was not registered with the SEC, did not maintain proper books and records and did not have adequate compliance policies and procedures in place.

Published on: January 13, 2012

Investment News: “Accredited Investor” Net Worth Standard Definition Modified by SEC

by InvestorLawyers

Investment attorneys would like to make investors aware that the final rule declaring the net worth standard for “accredited investors” has been adopted by the Securities and Exchange Commission. The SEC still had to adjust its rules to the modification despite the fact that the modified definition was effective upon the enacting of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Investment News: “Accredited Investor” Net Worth Standard Definition Modified by SEC

According to the Securities Act of 1933, unless there is an exemption, such as “accredited investor” status, all U.S. securities sales and offers must be registered. Before the Dodd-Frank Act was enacted, an investor’s main residence, along with its fair market value and indebtedness, were included when calculating an investor’s net worth. In order to be an “accredited investor,” one’s net worth must be at least $1 million.

According to the Dodd-Frank Act’s Section 413(a), when determining if an individual is an “accredited investor,” the value of that person’s primary residence cannot be included. Determining if a person is an “accredited investor” is used to identify people who can withstand the economic risk of investing in unregistered securities. Securities that are unregistered for an indefinite timeframe can result in total investment losses. While personal residence cannot be included when determining an investor’s status, per the Dodd-Frank Act, if there is indebtedness associated with the residence, this amount can still lower the net worth of the investor. This rule will lower the number of individuals that receive “accredited investor” status. However, individuals that were previously considered “accredited investors,” but no longer meet the $1 million threshold because of the rule changes, will be given a limited grandfathering that allows them to continue to receive accredited status for certain “follow-on” investments.

Published on: January 12, 2012

Investment Attorneys Seeking Victims of Self-Directed IRA Fraud

by InvestorLawyers

Stock fraud lawyers are seeking clients that have been the victim of stock broker fraud through the use of self-directed IRAs. Self-directed IRAs are held by a custodian or trustee and allow for investment in a broader set of assets than traditional IRAs. The custodial processes associated with self-directed IRAs gives investors a sense of security and protection. However, this is often not the case. Because self-directed IRAs’ owners are able to hold unregistered securities, due diligence is often neglected by custodians. As a result, these investments are often a vehicle of stock broker fraud.

Investment Attorneys Seeking Victims of Self-Directed IRA Fraud

The most common IRA custodians are broker-dealers and banks. In traditional IRAs, holdings are limited to mutual funds, CDs, firm-approved stocks and bonds. However, custodians for self-directed IRAs may invest in promissory notes, tax lien certificates, real estate and private placement securities. Investments that tie up retirement funds for a time period that is too long, fail to diversify in order to reduce possible loss or contain a risk for loss that is too high are in breach of advisers’ fiduciary duty and brokers’ suitability standard. In addition, early withdrawals come with a penalty that encourages money remains tied up in them longer.

Another significant danger of self-directed IRAs, and a reason they become a target for fraud promoters, is that they often do not require the custodian or trustee of the IRA to perform audits or keep accurate records.

Published on: January 11, 2012

Pacific Biosciences of California Investors Seeking Recovery of Losses

by InvestorLawyers

Allegations have been made that Pacific Biosciences of California Inc. (PacBio), as well as some of its officers and directors, knowingly or recklessly failed to disclose information and/or made materially misleading statements. These statements, along with the alleged failure to disclose information, would be in violation of the Securities Exchange Act of 1934 and, as a result, investment attorneys are investigating possible claims on behalf of shareholders.

Pacific Biosciences of California, Inc. Investors Seeking Recovery of Losses

PacBio is based in Menlo Park, California. The company handles the development, manufacturing and marketing of a genetic analysis integrated platform. PacBio commercializes the SMRT — or single molecule, real-time technology — platform, which is used to detect biological events.

A class action lawsuit was filed in the United States District Court for the Northern District of California against PacBio for the class period of October 27, 2010 through September 20, 2011. The lawsuit alleges that for the class period, PacBio misled investors by failing to disclose facts about their operational and financial condition. The company’s condition was a result of significant problems related to its third generation human genome sequencing technology. Furthermore, allegations have been made that PacBio’s stock traded at artificially-inflated prices as a result of the materially false and misleading statements. According to some shareholders, the company’s common stock prices fell 24 percent after an announcement on September 20, 2011, that revealed the truth about PacBio’s business prospects and the related revenue projections. The significant drop in the company’s common stock prices resulted in losses for many investors.

Published on: January 9, 2012

Lloyds Banking Group Investors Could Recover Investment Losses

by InvestorLawyers

Investment attorneys are encouraging individuals who invested with Lloyds Banking Group related to the class action lawsuit filed on November 23, 2011, to explore all possible loss recovery options. The class action lawsuit was filed in the United States District Court of the Southern District of New York and applies to the class period running from October 1, 2008 to February 27, 2009.

Lloyds Banking Group Investors Could Recover Investment Losses

The lawsuit makes allegations related to the acquisition of Halifax Bank of Scotland (HBoS), which occurred on September 18, 2008. The acquisition was reported on Lloyds Banking Group’s SEC 6-K filing.

The class action lawsuit states that, “Unbeknownst to the public, beginning on October 1, 2008, HBoS was insolvent, and had received Emergency Liquidity Assistance (ELA) from the Bank of England.” According to the lawsuit’s allegations, “Defendants had actual knowledge about the HBoS’s financial condition, and in particular, its receipt of the ELA and the circumstances which necessitated the ELA, and their failure to disclose this information rendered their public filings materially false and misleading.”

Published on: January 5, 2012

FINRA Decision: Barclays Capital Fined $3 Million

by InvestorLawyers

A major concern in the investment industry is that investors should be, but often are not, provided with sufficient and accurate information on their investments which will allow them to make informed investment decisions. A recent Financial Industry Regulatory Authority (FINRA) securities arbitration case resulted in Barclays Capital Inc. being fined for failure to adequately supervise the issuance of residential subprime mortgage securitizations, plus misrepresentation of delinquency data. Of the case, FINRA Executive Vice President and Chief of Enforcement Brad Bennett stated, “investors were supplied inaccurate information to assess future performance of RMBS investments.”

FINRA Decision: Barclays Capital Fined $3 Million

According to FINRA, “historical performance information for past securitizations that contain mortgage loans similar to those in the RMBS being offered to investors” must be disclosed by issuers of residential subprime mortgage securitizations. This information is vital to investors’ attempts to determine if the failure of mortgage holders to make payments could disrupt future returns. Therefore, without this information, investors cannot make an adequately informed decision about their investment.

According to FINRA’s investigation, the historical delinquency rates of three subprime RMBS, for which Barclays was underwriter and seller, were misrepresented from March 2007 through December 2010.

Published on: January 4, 2012

Potential Loss Recovery for Weyerhaeuser Stockholders

by InvestorLawyers

A recent securities arbitration proceeding regarding Weyerhaeuser stock has investors seeking representation for potential claims. According to the recent claim, which was filed with the Financial Industry Regulatory Authority, a retiree who held a concentrated position in Weyerhaeuser stock sustained $200,000 in damages. The claimant inherited the stock upon the passing of his mother; he then sought investment advice from Merrill Lynch.

Potential Loss Recovery for Weyerhaeuser Stockholders

Allegedly, despite the risk management strategies available to them — such as stop loss orders, exchange funds, a collar and/or protective put options —Merrill Lynch failed to protect some or all of the concentrated Weyerhaeuser stock positions under its advisement. Protective Puts allow the investor to create, at the put’s strike price, a price floor. This allows the investor to participate in the stock’s appreciation, customize the maturity of the put and stripe price, while providing downside protection. A collar, on the other hand, simultaneously Sells a call and purchases a put so that the proceeds and cost of the call and the put offset one another, which allows for hedging without requiring out-of-pocket expenses.

In addition to the company’s failure to utilize risk management strategies, Merrill Lynch failed to explain the risks associated with the holding of a concentrated stock position to clients. Merrill Lynch had a duty to protect the investment but failed to do so. This arbitration claim is still pending, but others who sustained losses as a result of the same mishandling of funds also are encouraged to seek the recovery of their losses through securities arbitration.

Published on: January 2, 2012

A Notice to the Clients of William Tatro

by InvestorLawyers

Investment attorneys are interested in speaking with clients of William Tatro in connection with investment losses they suffered under his advisement. Complaints have been registered against Tatro stating that he recommended to his clients unsuitable, illiquid, high commission investments. These investments had a higher degree of risk than many clients would have accepted, and in some cases resulted in massive losses. Many clients lost a significant amount of their life savings. These recommendations were in violation of Financial Industry Regulatory Authority regulations which state that recommendations must be suitable for the client and in keeping with their investment goals. A broker may not, for example, recommend very risky investments to an individual who can’t afford to sustain the losses, such as a retiree.

A Notice to the Clients of William Tatro

Another type of investment that is usually unsuitable for retirement accounts are annuities investments. Annuities restrict the availability of funds and are high commission investments. Complaints against Tatro allege that he repeatedly sold leveraged inverse Exchange Traded Funds (ETFs) and Real Estate Investment Trusts (REITs) to clients for whom the investments were unsuitable. REITs are high-commission variable annuities. FINRA issued a warning which stated that leveraged inverse ETFs are unsuitable for ordinary investors and that these investments should be held for a short time period only. Despite FINRA’s warning, Tatro allegedly recommended these investments and held the investments long-term. Many investors have stated that this was the case for their accounts and that they sustained substantial losses as a result.

In the claim of Mid-Lakes Management Corp. vs. Eagle Steward Wealth Management LLC, one arbitrator stated that, “There was no evidence that Mr. Tatro properly investigated leveraged inverse funds. In fact, it is highly unlikely that Mr. Tatro could have done so, for such research would have demonstrated that holding leveraged inverse funds for a lengthy period of time dramatically increased risk of the claimant.” In resolving the claim, $530,449 in damages was awarded to the claimant.

Published on: December 29, 2011

Have You Been a Victim of Fraud Because of Celebrity Trust?

by InvestorLawyers

One troublesome form of stock broker misconduct involves the use of celebrity status in order to gain the trust and secure the business of investors. One major problem with this type of scam is that many investors don’t want to admit that they made an investment decision based on the celebrity status of the spokesperson. However, investment attorneys encourage victims of fraud — regardless of their motivations for investing — to seek reimbursement of their losses through securities arbitration.

Have you been a Victim of Fraud Because of Celebrity Trust?

While fraud cases that use the celebrity status of an individual to gain investor trust are nothing new, the most recent incident used the fame of a former Olympic sprinter and NFL wide receiver Willie Gault. Gault managed a California-based medical device company called Heart Tronics. Between 2006 and 2008, the company announced fake sales orders for heart-monitoring devices valued at millions of dollars.

The Securities and Exchange Commission filed a complaint on December 20, 2011, in the United States District Court in California. In addition, the SEC sued Mitchell Stein, who hired promoters to use the Internet to tout the company’s stock and controlled most of Heart Tronics’ business activities. Also named in the complaint were J. Rowland Perkins, Gault’s co-chief executive officer and founder of Creative Artists Agency LLC, and Martin Carter, Stein’s chauffer and handyman.