Morgan Keegan & Co., the brokerage division of Regions Financial Corp., and some of its former top investment professionals, have been charged with misrepresentation, making unsuitable investment recommendations and offering preferential treatment to selected investors, according to the Alabama Securities Commission. The allegations were made in an administrative complaint filed in conjunction with a multi-state investigation into the RMK Select family of mutual funds that lost $2 billion in 2007 and 2008 resulting from investing in risky mortgage-backed bonds.
The Securities and Exchange Commission is also involved and has charged Morgan Keegan and two employees with fraud related to the mutual funds managed by the firm. One of the employees is none other than James Kelsoe, who directed the sub-prime investing activities of the mutual funds, which cratered when mortgage defaults began skyrocketing in 2007. The administrative enforcement action filed by the Alabama Securities Commission requires Morgan Keegan to prove why its state license should not be revoked.
Alabama and the other states also intend to seek financial penalties and restitution for investors. We have been working on Morgan Keegan cases for a good while. Currently, our firm is representing a number of individuals who have claims against Morgan Keegan. If you need additional information, contact Scarlette Tuley or Archie Grubb, lawyers in our firm, at 800-898-2034 or by email at Scarlette.Tuley@beasleyallen.com or Archie.Grubb@beasleyallen.com.
Source: Birmingham News
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