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MORTGAGE AND SUBPRIME LENDING FRAUD LAWYER |
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MORTGAGE AND SUBPRIME LENDING FRAUD LAWYER |
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Our office
is handling claims on behalf of various victims of the
subprime mortgage crisis. These include losses claims
against brokers, custodians of retirement plans, mutual funds, and the
companies themselves.
Brokers are a primary potential defendant where they recommended stocks or mutual funds which took substantial losses. A speculative stock or mutual fund which suffered a substantial loss may be regarded as unsuitable for an investor who sought a safe retirement portfolio. Some considerations in the evaluation:
A. Suitability
NASD Rule 2310 provides, (a) In
recommending to a customer the purchase, sale or exchange of any
security, a member shall have reasonable grounds for believing that
the recommendation is suitable for such customer. Suitability
incorporates various factors. A 30 year old aggressive investor
not be able to complain about losses that a 63 year old man facing
retirement would.
1. Subprime Exposure
Today at least retrospectively, we recognize the risks heavy investment in subprime loans or securities raised. Even a small downturn in real-estate values could trigger significant losses with heavily leveraged properties. Was the risk properly disclosed and recognized by both broker and customer.
B. Benchmark Performance
Many stocks and mutual funds have taken substantial losses, and the existence of a loss alone would not provide a claim. Some of our pages deal directly with funds with subpar performance. Eaton Vance dividend income fund; Morgan Keegan claims . Defending a large quarterly loss, a mutual fund prospectus stated our fund was designed to mirror the performance of the Nikkei index and it did precisely that. A 50% loss might seem devastating until we see similar funds with the same class experiencing the same type of loss. Thus we look to the performance of similar mutual funds or stocks and see how the broker's recommendation fared.
C. Diversification
Was the portfolio properly diversified, particularly if the investor sought to limit losses.
D. Arbitration
Generally these claims are handled through arbitration under an agreement the customer signed. Initially, the investments may have been unsuitable for the investor. Related in the responsibility for diversification. Concentration of assets to a single speculative endeavor may have increased the possibility for loss. A starting point will be the customer's investment profile.
2. Securities fraud claims against Mutual funds
Similar considerations apply to claims against the mutual funds themselves. A fund which fairly disclosed the nature of its investments will usually not face liability just because it took a loss. Instead while a large loss may trigger review, something more is needed to establish liability.
A. Deviation from Prospectus
Does the prospectus fairly and accurately set forth the nature of the firm's investments and the investor's exposure to loss. One who decided to invest in a fund specializing in Eastern European securities may not be heard to complain when conflict and economic changes cause a large loss to the fund portfolio. On the other hand, a fund attracting conservative investors by marketing itself as investing in corporate funds may be misleading investors if its investments are tied to subprime mortgages and it does not disclose that fact.
3. Accounting Negligence
Accountants and other professionals who reviewed financials, provided opinions, and rendered auditing services may have failed to perform such services with reasonable care. See auditor and accounting fraud accounting negligence defenses
4. Fraud on consumers
Consumers may have been victimized by Truth in Lending violations, false statesment by brokers or banks about rates and other terms, inadequate disclosure, and violation of state and federal statutes.
5. Erisa and Retirement Plan Obligations
The Employee Retirement Income Security
Act (ERISA) regulates 401(k) and other retirement plan accounts.
Workers across America today depend on their company sponsored
retirement plans to provide them with income after their retirement.
ERISA requires the employer to provide pertinent information and to
act prudently and loyally. ERISA's fiduciary duties apply to
investment options. Where an employer invests substantial amounts
imprudently claims are possible.
A. Diversification Retirement Plan participants may find their assets concentrated in company stock. Whether and when the Plan has a duty to diversity has been debated. One threshold question is what the Plan documents provide, and whether the actual investments deviated from the Plan. Erisa claim permitted under Plan documents
B. Defenses Plan participants soemtiems themselves directed investments. "Avaya offered plan participants 23 investment options which the Summary Plan Descriptions explain, "differ in their investment objectives and opportunities for risk and return." Edgar v. Avaya (3d Cir. 2007).
6. Nature of representation
We provide a free initial consultation with many claims handled on contingency.
Law Offices of Howard A. Gutman,
QUALIFICATIONS AND EXPERIENCE OF THIS LAW OFFICE
Howard A. Gutman has been involved with fraud and contract litigation for the past 15 years. He has spoken at the National Press and on Good Day New York and been interviewed by NBC Nightly News and Newsday. His cases have been profiled in the Star Ledger, Bureau of National Affairs Magazine, and New York Times. He is a graduate of the University of Michigan, ranked among the top 10 law schools in the nation, where he was an editor of its Journal of Law Reform. Prior to establishing his practice, Mr. Gutman was employed by one of the leading law firms in New Jersey and a prominent international law firm located on Wall Street.
FREE INITIAL CONSULTATION
We offer a free initial telephone consultation to discuss your investment or securities claim. Please feel free to call or e-mail our office. Keywords mortgage fraud, deception, investment loss, New Jersey securities lawyer, Countrywide, Lehman fraud, Baer Sterns claims, retirement plan losses, Ameriquest, subprime lending fraud, retirement plan fraud, mortgage misrepresentation, securities misrepresentation, negative amortization, Countrywide Mortgage, mortgage bank, mortgage loan fraud, change in rates, home mortgage fraud, types of bank fraud.
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