NEW YORK, June 22, 2011 (GLOBE NEWSWIRE) -- The Securities and Exchange Commission (SEC), state regulators, and the Financial Industry Regulatory Authority (FINRA) have found that Morgan Keegan & Co. Inc., Morgan Asset Management, James C. Kelsoe, and comptroller Joseph Thompson Weller violated numerous securities laws and industry standards.
The Morgan Keegan Funds include RMK High Income Fund (formerly RMH, currently HIH), RMK Advantage Income Fund (formerly RMA, currently HAV), RMK Multi-Sector High Income Fund (formerly RHY, currently HMH), RMK Strategic Income Fund (formerly RSF, currently HSA), RMK Select High Income Fund (formerly MKHIX, currently HIFAX), and the RMK Select Intermediate Fund (formerly MKIBX, currently HSIBX). According to the regulatory findings Morgan Keegan misled investors about the composition of the Funds underlying assets and the value of those assets. The regulators conducted an extensive investigation that uncovered the true risks inherent in the Funds.
Robert Khuzami, Director of the SEC's Division of enforcement stated that Morgan Keegan's, "falsification of fund values misrepresented critical information exactly when investors needed it most – when the subprime mortgage meltdown was impacting the funds," Mr. Khuzami further explained that "[s]uch misconduct does grievous harm to investors."
Under the settlement, Morgan Keegan is required to pay $25 million in disgorgement and interest, $75 million penalty to the SEC for the benefit of investors harmed and $100 million into a state fund that also will be distributed to harmed investors.
Paul Napoli, senior partner at Napoli Bern Ripka, LLP commented, "This is a great victory for investors. We very much look forward to continuing to pursue fraud claims on behalf of aggrieved investors; to date our firm has handled hundreds of individual claims against Morgan Keegan and we will do whatever is in our power to help investors."
Napoli Bern Ripka, LLP has successfully advocated for its clients who have been misled by Morgan Keegan. If you, your company, or pension fund have suffered significant losses in any of the RMK Funds listed above please feel free to contact us. To learn more about how Napoli Bern Ripka, LLP can help you, or to get a free evaluation of our potential claim, contact the firm's securities litigation department at (212) 267-3700.
CONTACT: Napoli Bern Ripka, LLP Adam J. Gana Esq. 212-267-2700 Agana@nbrlawfirm.com