A Florida lawsuit against Regions Bank, which seeks class-action status over the bank’s partnership with an unregistered investment firm, can move forward as the result of a ruling that the statute of limitations had not run. A judge in U.S. District Court in Miami ruled that the suit can proceed on behalf of 14,000 investors who put up about $250 million through a company named U.S. Pension Trust Corp. that partnered with Birmingham-based Regions. U.S. Pension Trust has already been sanctioned after being found guilty of unlawfully engaging in the sale of securities as an unregistered dealer. It had to pay back $62 million to investors and forfeit $50 million in civil penalties.
In 2009, Regions agreed to pay $1 million to settle a Securities and Exchange Commission case over the matter. Regions is defending the Florida suit which seeks class-action status for the bank’s part in the unregistered U.S. Pension Trust Corp. investment program. It’s alleged in the suit that Regions was the trustee of the plan, which swept up investment money mostly in Latin American nations for investment in U.S. mutual funds through the Birmingham bank.
Regions claimed that the statute of limitations had run on the claims. The investment plans were sold from 1995 through 2008. But the judge in the case disagreed with Regions, ruling that the starting date for the statute of limitations was September 2009, when Regions settled with the SEC.
The lawsuit, seeking class-action status and repayment of money invested, says Regions performed a wide variety of tasks in support of the unregistered investment plan. Those tasks included, the suit alleges, the use of Regions’ name and logo on sales materials, production of a marketing video, training to USPT sales representatives, and sharing fees with USPT. Regions, based in Birmingham, operates about 1,700 branches in 16 states.
Source: The Birmingham News
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