COLCHESTER, Conn.-May 28, 2005- LAWFUEL – The Law News Network -The law firm of Scott + Scott, LLC announced a class action lawsuit against R&G Financial Corporation (NYSE: RGF – News) and several of its officers also alleging violations of the federal securities laws (Securities Exchange Act of 1934). The action is pending in the United States District Court for the Southern District of New York.
The complaint alleges that from April 21, 2003 through April 25, 2005 (“Class Period”), R&G failed to disclose that its earnings were materially undermined by aggressive assumptions relating to “gain on sale” income and the value of “interest only” or “IO” strips. The Complaint alleges that R&G and certain officers and directors misled investors. The complaint alleges that RGF stock traded at artificially inflated prices during the Class Period. On April 26, 2005, R&G announced that the Securities and Exchange Commission had commenced an investigation into its announced restatement.
Scott & Scott also announces actions against MBNA Corp. (NYSE: KRB – News). This case has been filed in the U.S. District Court for the District of Delaware. MBNA suffered an unreasonably sharp contraction in loans during Q1 2005 causing total managed loans to decrease, the Company had been aggressively recognizing gains on sales of securitized no-interest loan receivables through off-balance sheet funding structures and that MBNA was experiencing higher-than-expected delinquencies during Q1 2005.
As a result of the Company’s accounting practices, it is alleged that the books were overstated and the Company’s previously announced Q1 2005 restructuring charge had doubled. As a result of these allegedly false statements, MBNA’s stock traded at inflated levels during the Class Period which permitted the Company’s top officers and directors to sell more than $75 million worth of their own shares. Those who purchased MBNA securities prior to April 25, 2005 can contact Scott + Scott for more information.
If you would like information about Scott + Scott’s original complaint please contact the firm at 800/404-7770. You can also speak with attorney Neil Rothstein at [email protected] (800/332-2259 or via cell phone 619/251-0887) or attorney Amy K. Saba at [email protected] (800/332-2259). Scott + Scott has offices in Connecticut, Ohio and California. The firm (http://www.scott-scott.com) specializes in complex litigation including securities fraud and represents foundations, individuals, corporations and pension funds worldwide. Other current cases include Rhodia, Harley-Davidson, Doral Financial, Able Pharmaceuticals and more.