Mar 27, 2017 | Securities Class Action Archive
Kehoe Law Firm, P.C. announces that a class action complaint was filed against Walter Investment Management Corp. (NYSE: WAC) in the United States District Court for the Middle District of Florida on behalf of those who purchased Walter Investment Management (“Walter” or the “Company”) securities between February 29, 2016 and March 13, 2017, for alleged violations of the Securities Exchange Act of 1934 by Walter and three current or former senior officers. Walter is a diversified independent originator and servicer of mortgage loans, and a servicer of reverse mortgage loans in the United States. Ditech Financial is one of Walter’s subsidiaries.
Walter Investment Management Corp. Accused of Failing To Implement Adequate Financial Controls
According to the complaint, on February 29, 2016, Walter filed its Form 10-K with the SEC, stating that the Company’s recent rebranding and consolidation of Ditech would allow Walter to improve its recapture performance. Walter subsequently stated in another SEC filing that it had taken distinct actions to improve efficiencies within the organization by restructuring its mortgage loan servicing operations and improving profitability. The class action complaint alleges that Walter’s public statements were misleading because Walter failed to disclose that Ditech had a material weakness in its internal control over operational processes and, thus, lacked effective internal controls over financial reporting.
On March 14, 2017, Walter Investment Management disclosed in its Form 10-K for the year ended December 31, 2016 that “[a]s of December 31, 2016, we identified a material weakness in internal controls over operational processes within the transaction level processing of Ditech Financial default servicing activities. Specifically, we did not design and maintain effective controls related to our ability to identify foreclosure tax liens and resolve such liens timely, foreclosure related advances, and the processing and oversight of loans in bankruptcy status. This resulted in several adjustments to reserves during the fourth quarter of 2016 totaling $16.3 million for exposures related to deficient processes within the operating control environment for default servicing.”
Following this news, Walter’s common stock dropped $1.05 per share, or 38.89%, to close at $1.65 per share on March 14, 2017.
What Can Walter Investment Management Corp. Shareholders Do?
If you purchased Walter common stock between February 29, 2016 and March 13, 2017, please contact John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected], [email protected], for information about your potential legal rights. Please also feel free to complete the form on the right, and a member of the Kehoe Law Firm will contact you directly.
Kehoe Law Firm, P.C. is a multidisciplinary, plaintiff–side law firm dedicated to protecting investors and consumers from corporate fraud, negligence, and other wrongdoing. Driven by a strong and principled sense of social responsibility and obtaining justice for the aggrieved, Kehoe Law Firm, P.C. represents plaintiffs seeking to recover investment losses resulting from securities fraud, breaches of fiduciary duty, corporate wrongdoing or malfeasance, those harmed by anticompetitive practices, and consumers victimized by fraud, false claims, deception or data breaches. Together, the partners of the Kehoe Law Firm, P.C. have spent more than 30 years prosecuting precedent-setting securities and financial fraud cases in federal and state courts on behalf of institutional and individual clients.
Mar 18, 2017 | Securities Class Action Archive
The Kehoe Law Firm, P.C. is investigating potential claims on behalf of purchasers of National General Holdings Corp. common stock or securities concerning whether there was a material weakness in the company’s internal controls over financial reporting as of December 31, 2015, and whether the company and certain of its executive officers and directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
On March 16, 2017, after the markets closed for trading, National General Holdings announced that it will be unable to file its Annual Report for the fiscal year ended December 31, 2016 within the 15 day extension granted by the Form 12b-25 filed with Securities and Exchange Commission on March 1, 2017. It also revealed that the company expects to disclose that, as part of its evaluation of its internal controls over financial reporting, management had determined there were material weaknesses in internal control over financial reporting as of December 31, 2015. These material weaknesses reportedly relate to the precision and sufficiency of formal documentation, including determining the completeness and accuracy of reports used in this operation of management’s review procedures as it relates to the following areas:
- Investment accounting – the documentation of investment reconciliations and the documentation of the procedures for review of securities for other than temporary impairment and valuation of investments;
- Accounting for acquisitions – in particular the documentation related to the opening balance sheet and documentation related to the development of assumptions used in the valuation of intangibles;
- Accounting for income taxes – the documentation of the procedures for review of the income tax provision; and
- Completeness and accuracy of reports used in accounting for premiums, investments, loss reserves and claims.
On this news, the company’s share price fell $0.77, or 3.21%, in intraday trading on March 17, 2017.
If you purchased or otherwise acquired National General Holdings shares or would like to speak privately with a securities attorney to contribute to or learn more about the investigation, please complete the form to the right or contact John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected]; or send an e-mail to [email protected].
Kehoe Law Firm, P.C. is a multidisciplinary, plaintiff–side law firm dedicated to protecting investors and consumers from corporate fraud, negligence, and other wrongdoing. Driven by a strong and principled sense of social responsibility and obtaining justice for the aggrieved, Kehoe Law Firm, P.C. represents plaintiffs seeking to recover investment losses resulting from securities fraud, breaches of fiduciary duty, corporate wrongdoing or malfeasance, those harmed by anticompetitive practices, and consumers victimized by fraud, false claims, deception or data breaches. Together, the partners of the Kehoe Law Firm, P.C. have spent more than 30 years prosecuting precedent-setting securities and financial fraud cases in federal and state courts on behalf of institutional and individual clients.
Mar 18, 2017 | Securities Class Action Archive
The Kehoe Law Firm, P.C. is investigating potential claims on behalf of purchasers of AmTrust Financial Services, Inc. common stock or securities who allege that the company’s share were inflated as a result of accounting errors and material weaknesses in internal controls over financial reporting, and whether AmTrust and certain of its executive officers and directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
Material Weaknesses In Internal Controls
On February 27, 2017, AmTrust disclosed that it had “identified material weaknesses in its internal control over financial reporting that existed as of December 31, 2016, specifically related to ineffective assessment of the risks associated with the financial reporting, and an insufficient complement of corporate accounting and corporate financial reporting resources within the organization.”
On this news, AmTrust’s share price fell $5.32, or 19.23%, to close at $22.34 on February 27, 2017.
AmTrust to Restate Prior Financial Results
On March 16, 2017, AmTrust announced that it needed additional time to complete the consolidated financial statements and assessment of internal controls over financial reporting for the fiscal year ended December 31, 2016. It also revealed that, in connection with the preparation and audit of the financial statements, the Audit Committee of the AmTrust Board of Directors, concluded that the company’s previously issued consolidated financial statements for 2014 and 2015 (including for each of the four quarters of 2015) as well as for the first three quarters of 2016 should be restated and should no longer be relied upon.
In addition, AmTrust reported that the certain of the company’s earnings and press releases, and related communications, to the extent that they relate to periods covered by the upcoming restatement, as well as the company’s fourth quarter and fiscal 2016 earnings release dated February 27, 2017, should no longer be relied upon. Additionally, AmTrust cautioned that the reports of BDO USA LLP, the company’s former independent auditor, on the company’s consolidated financial statements for 2014 and 2015, including its opinions on the effectiveness of internal control over financial reporting for such periods, likewise should no longer be relied upon.
On this news, AmTrust’s share price fell $4.03, or 18.65%, to close at $17.58 on March 17, 2017.
If you purchased or otherwise acquired AmTrust shares between January 1, 2014 and March 16, 2017, or would like to speak privately with a securities attorney to contribute to or learn more about the investigation, please complete the form to the right or contact John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected]; or send an e-mail to [email protected].
Kehoe Law Firm, P.C. is a multidisciplinary, plaintiff–side law firm dedicated to protecting investors and consumers from corporate fraud, negligence, and other wrongdoing. Driven by a strong and principled sense of social responsibility and obtaining justice for the aggrieved, Kehoe Law Firm, P.C. represents plaintiffs seeking to recover investment losses resulting from securities fraud, breaches of fiduciary duty, corporate wrongdoing or malfeasance, those harmed by anticompetitive practices, and consumers victimized by fraud, false claims, deception or data breaches. Together, the partners of the Kehoe Law Firm, P.C. have spent more than 30 years prosecuting precedent-setting securities and financial fraud cases in federal and state courts on behalf of institutional and individual clients.
Feb 23, 2017 | Securities Class Action Archive
Kehoe Law Firm, P.C. is investigating Global Eagle Entertainment Inc. (“Global Eagle” or “Company”) for possible violations of the federal securities law. On February 21, 2017, before the market opened for trading, Global Eagle (NASDAQ: ENT) announced that its CEO, David Davis, and CFO, Tom Severson, had resigned and that the Company expects to delay filing its 2016 Annual Report with the U.S. Securities and Exchange Commission. On this news, Global Eagle’s share price fell $1.74, or 27.97%, to close at $4.48 on February 21, 2017.
Global Eagle’s Announcement
Global Eagle offered few details concerning the reason for the departure of the CEO and CFO. Regarding the filing delay, the Company claimed it was due to “increased size and complexity” after its acquisition of Emerging Markets Communications, as well as “its need to transition the finance department after the prior CFO’s departure and its need to complete additional financial-closing procedures associated with the Company’s material weaknesses in internal control over its financial reporting.”
Evidence of Accounting Problems?
As The Motley Fool reported in a February 21, 2017 article:
The sudden departure of the CEO and CFO, which could be evidence of accounting problems, prompted an investigation from a shareholder rights law firm[,] . . . which said it was looking into possible violations of federal securities laws by Global Eagle.
Global Eagle also said it would file its 10-K after the SEC March 16 deadline, noting among other factors that it needs “to complete additional financial closing procedures associated with the Company’s material weaknesses in internal control over its financial reporting” (emphasis added). Such a statement seems to indicate accounting inconsistencies, which could force the company to restate past financial statements or incur fines from the SEC.
(Full article available here.)
Class Action Lawsuit Filed
On February 23, 2017, a class action lawsuit was filed in the United States District Court for the Central District of California on behalf of those who purchased Global Eagle common stock between July 27, 2016 and February 17, 2017 (the “Class Period”). The Complaint alleges that Global Eagle and certain executive officers violated various provisions of the federal securities laws during the Class Period.
What if I’m a Global Eagle Shareholder?
Those who purchased Global Eagle shares during the Class Period, and who are interested in learning more about our investigation, are encouraged to contact the Kehoe Law Firm, P.C. by completing the form on the right or by calling Michael Yarnoff, Esq., (215) 792-6676, Ext. 804, [email protected]; John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected]; or by sending an e-mail to [email protected].
Kehoe Law Firm, P.C. is a multidisciplinary, plaintiff–side law firm dedicated to protecting investors and consumers from corporate fraud, negligence, and other wrongdoing. Driven by a strong and principled sense of social responsibility and obtaining justice for the aggrieved, Kehoe Law Firm, P.C. represents plaintiffs seeking to recover investment losses resulting from securities fraud, breaches of fiduciary duty, corporate wrongdoing or malfeasance, those harmed by anticompetitive practices, and consumers victimized by fraud, false claims, deception or data breaches. Together, the partners of the Kehoe Law Firm, P.C. have spent more than 30 years prosecuting precedent-setting securities and financial fraud cases in federal and state courts on behalf of institutional and individual clients.
Jan 10, 2017 | Securities Class Action Archive
The Kehoe Law Firm, P.C. is investigating claims on behalf of purchasers of General Cable Corporation (NYSE: BGC) common stock to determine whether General Cable Corporation (“General Cable” or “the Company”) and its executives violated federal securities laws or breached their fiduciary duties by failing to disclose that the Company might have engaged in activities in Angola, Bangladesh, China, Egypt, Indonesia, and Thailand that violated the Foreign Corrupt Practices Act (“FCPA”).
General Cable’s Alleged Violations
A recent U.S. Department of Justice (“DOJ”) press release stated:
According to General Cable’s admissions, some parent-level and subsidiary-level employees, including executives, knew that some of its foreign subsidiaries used third-party agents and distributors to make corrupt payments to foreign officials in order to obtain and retain business. In one case the foreign subsidiary made corrupt payments directly to foreign officials. The corrupt conduct began in 2002. In 2011, when employees from a General Cable subsidiary expressed concerns to regional and parent-level executives that commission payments were being used for improper purposes, including potentially bribery, General Cable nevertheless failed to implement and maintain a system of internal accounting controls designed to detect and prevent such corruption and otherwise illegal payments.
Further, DOJ reported that “[b]etween 2002 and 2013, General Cable subsidiaries paid approximately $13 million to third-party agents and distributors, a portion of which was used to make unlawful payments to obtain business, ultimately netting the company approximately $51 million in profits.
General Cable’s Payments to the Government
On December 29, 2016, General Cable Corporation (“GCC”) agreed to pay the U.S. Department of Justice and the Securities and Exchange Commission (“SEC”) $75.75 million to resolve the FCPA violations.
According to DOJ’s press release, the Company entered into a non-prosecution agreement with the Justice Department on December 22, 2016 and agreed to pay a $20.4 million criminal penalty.
According to an SEC Cease and Desist Order, General Cable agreed to pay more than $55.3 million in disgorgement and prejudgment interest.
What If I’m a General Cable Shareholder?
If you currently are a shareholder of General Cable Corporation common stock acquired in 2013 or earlier, and wish to discuss the Kehoe Law Firm’s investigation of General Cable, please contact the Kehoe Law Firm, P.C. by completing the form on the right or by calling Michael Yarnoff, Esq., (215) 792-6676, Ext. 804, [email protected]; John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected]; or by sending an e-mail to [email protected].
Kehoe Law Firm, P.C. is a multidisciplinary, plaintiff–side law firm dedicated to protecting investors and consumers from corporate fraud, negligence, and other wrongdoing. Driven by a strong and principled sense of social responsibility and obtaining justice for the aggrieved, Kehoe Law Firm, P.C. represents plaintiffs seeking to recover investment losses resulting from securities fraud, breaches of fiduciary duty, corporate wrongdoing or malfeasance, those harmed by anticompetitive practices, and consumers victimized by fraud, false claims, deception or data breaches. Together, the partners of the Kehoe Law Firm, P.C. have spent more than 30 years prosecuting precedent-setting securities and financial fraud cases in federal and state courts on behalf of institutional and individual clients.
