Angry Investors File Suit
Attorney
(866) 735-1102 Ext 415
A wave of class action lawsuits has begun by angry shareholders who invested in two mortgage giants Fannie Mae and Freddie Mac.
They allege that stock underwriters hid the true numbers on the mortgage giants, failing to disclose that Fannie Mae was “grossly undercapitalized” as a result of the subprime holdings. The stock is currently valued at $1.50 a share and is in conservatorship with the U.S. Treasury Department.
Two similar class actions have been filed in the Southern District of New York against the same defendants - Morgan Stanley, Merrill Lynch, Goldman Sachs, UBS and Wachovia Capital Markets LLC. Individual lawsuits will likely yield better results for the big investor over a class action.
Many investors are wondering if they have any recourse for investments that came highly recommended, yet tanked. One case in point - The Reserve Yield Plus Fund (RUPQX) was sold by TDAmeritrade to clients claiming it was a “money market” fund. That was the presentation at least. Investors who purchased Reserve yield Plus Fund have formed an internet group to share war stories and consider possible litigation.
Some elderly investors put their entire life savings in the fund because it was supposed to be so safe. Now their money has been frozen since mid September. TD Ameritrade is accused of giving very misleading advice about fixed income investments to too many customers, some of whom rely on the funds to live and now find themselves being held hostage.
Don’t expect the Securities and Exchange Commission or the FBI to get involved as protecting Wall Street is job number one.