WASHINGTON, Feb. 16 LAWFUEL – Class Action Litigation News — Klafter & Olsen LLP announces that
it has filed a class action lawsuit in the United States District Court for the Central District of California on behalf of purchasers of the common stock and other securities of New Century Financial Corp. (“New Century” or the “Company”) (NYSE: NEW) who purchased during the period from May 4, 2006 through February 7, 2007, inclusive (the “Class Period”).
The claims against New Century and certain of its officers and
directors allege that the defendants violated the federal securities laws
by making false and misleading statements and omissions concerning the
Company’s operations and financial results for the first three quarters of
2006. New Century, a mortgage finance company, makes substantial amounts of
residential mortgage loans. It does not hold these loans but sells the
loans to banks and investors. The purchasers can require New Century to
repurchase loans which become troubled.
On February 7, 2007 the Company shocked the market by announcing that
it was going to restate its financial results for the first three quarters
of 2006 because the Company had failed to account for all of the
re-purchased loans, and had failed to properly reduce the value of the
loans repurchased. The Company was forced to admit that its financial
statements could no longer be relied upon. As a result of this unexpected
news, New Century shares slumped to a 52-week low, plunging $10.92, to
close at $19.42 per share a decline of over 36% on extraordinary volume of
over 25 million shares. However, before that announcement, Company insiders
sold more than $26 million worth of their personal holdings during the
If you purchased New Century publicly traded securities during the
Class Period (May 4, 2006 — February 7, 2007), you may, no later than
April 10, 2007, move to be appointed as a Lead Plaintiff. A Lead Plaintiff
is a representative party that acts on behalf of other class members in
directing the litigation. If you have sustained losses on your purchases of New Century publicly traded securities during the Class Period, please
contact Klafter & Olsen LLP at http://www.klafterolsen.com or call us at
202/261-3553 for a more thorough explanation of the Lead Plaintiff
selection process and the claims that can be asserted against New Century.
Klafter & Olsen LLP has extensive expertise in prosecuting investor
class actions involving financial fraud and has offices in Washington D.C.
and New York. Please visit our website for more information about the Firm.