Did you see this FP release?
First Plus Sued For Securities Fraud, Announces Berman, DeValerio & Pease LLP
BOSTON, Dec. 7 /PRNewswire/ -- FirstPlus Financial Group, Inc. (NYSE: FP) has been sued for violating the federal securities laws in a class action filed today in the United States District Court for the Northern District of Texas. The action is brought on behalf of all persons or entities who purchased the common stock of FirstPlus during the period of June 5, 1997 through November 2, 1998, inclusive.
The action charges that FirstPlus, a consumer finance company which makes loans to homeowners based on the value of their home, falsely claimed strong growth based upon its conservative accounting practices inflating the price of FirstPlus stock from its low of $21 to a Class Period high of $61 7/8. The Complaint further charges that defendants overvalued the Company's existing loan portfolio, failed to record adequate loan loss reserves and became increasingly dependant upon outside sources of capitalization. The inflation of FirstPlus shares enabled the Company to use its shares as currency to purchase other sources of revenue, including Life Financial Corporation. These purchases were designed to enable FirstPlus to post 1998 earnings growth.
The action also charges that Defendant Daniel T. Phillips, as a means to avoid alerting the investment community of the sale of a significant number of his FirstPlus shares, utilized the inflated price of FirstPlus to obtain more than $50 million from 3.7 million FirstPlus shares during early 1998 by placing his FirstPlus stock into a family partnership and then obtaining margin loans collaterized solely by his FirstPlus shares.
On November 3, 1998, FirstPlus shocked the investment community when it revealed a 70% decline in generative earnings, an $85.2 million write down, and that it would begin dismantling FirstPlus to avoid bankruptcy. FirstPlus' common stock, which were traded at $54 7/8 during the Class Period, dropped to below $3 7/8 per share.
If you purchased FirstPlus common stock during the Class Period you may wish to contact either Kathryn A. McElroy., Jeffrey C. Block, Esq. or Donald F. Campbell, Senior Paralegal, of Berman, DeValerio & Pease LLP at 800-516-9926 regarding your rights and interests in this matter. You can write to us at One Liberty Square, Boston, MA 02109, or send us an E-Mail at bdplaw@bermanesq.com. You can also visit us at our website at www.bermanesq.com.
In addition, under the federal securities laws you may, but not later than sixty days from October 30, 1998, move the court to serve as lead plaintiff of the Class, if you so choose. To serve as lead plaintiff, however, you must meet certain legal requirements. You may contact the attorneys at Berman DeValerio & Pease LLP to discuss your rights regarding the appointment of lead plaintiff.
Berman, DeValerio & Pease LLP, with offices in both Boston and San Francisco, has substantial experience in prosecuting class actions on behalf of defrauded investors and consumers. It has successfully litigated numerous actions charging companies with issuing materially false and misleading statements and has been singled out for its excellence by many courts.
SOURCE Berman, DeValerio & Pease LLP
CO: Berman, DeValerio & Pease LLP; FirstPlus Financial Group, Inc.
ST: Massachusetts, Texas
IN: FIN
SU: |
