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The Charles Schwab Corporation : Schwab YieldPlus Funds Investor Shares or Schwab YieldPlus Funds Select Shares Summary: According to a press release dated March 19, 2008, a proposed class-action lawsuit was filed on behalf of those who purchased Schwab YieldPlus Funds Investor Shares or Schwab YieldPlus Funds Select Shares from Charles Schwab Corporation during the Class Period.
Specifically, the complaint claims Charles Schwab Corporation headquartered in San Francisco, CA, the funds' underwriter, investment advisers and officers and directors issued untrue statements regarding the lack of diversification of these funds and the extent of investments assigned to sub-prime mortgage backed and related securities. The complaint alleges the funds registration statements and prospectuses contained untrue statements of material facts, and omitted important information regarding the funds' investments, ultimately misleading investors.
On Nov. 15, 2004, the Company began offering the Schwab YieldPlus investment funds through a registration statement and prospectus. The YieldPlus funds are advertised by the defendants as 'a safe alternative to money market funds that preserve principal while being designed with your income needs in mind'. Throughout the Class Period the Company claimed the funds were investments in a large, well-diversified portfolio, a seasoned team of taxable bond portfolio managers actively managed the funds, and that investment in Schwab YieldPlus would return higher yields on cash with only marginally higher risk, a smart alternative. Since July of 2007, the share price for the funds began lowering, for a total loss of 18 percent. Today the funds stand at an all-time low of $7.96, down more than 11 percent from Jan. 1, 2008.
The lawsuit claims the funds are not well diversified, instead concentrated in a single risky industry with more than 50 percent of the funds assets invested in the mortgage industry. The lawsuit seeks remedies under the 1933 Act on behalf of all fund purchasers during the Class Period.
According to Judge William Alsup’s April 28th orders, motion to relate cases were granted.
INDUSTRY CLASSIFICATION:
SIC Code: 6211
Sector: Financial
Industry: Investment Services
| COMPANY/ISSUER NAME: | The Charles Schwab Corporation |
| COMPANY/ISSUER TICKER: | SCHW |
| COMPANY WEBSITE: | http://www.schwab.com |
| FIRST IDENTIFIED COMPLAINT IN THE DATABASE | |||||||||||||||||
| Mike Labins, et al. v. The Charles Schwab Corporation, et al. | |||||||||||||||||
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| DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT | |||
| Class Action Complaint for Violation of the Federal Securities Laws - Jury Trial Demanded | |||
| Type: Complaint | Date on the document: 03/18/2008 | ||
| US District Court Civil Docket | |||
| Type: Docket | Date on the document: 4/28/2008 | ||
| OTHER DOCUMENTS | |||
| Class Action Complaint for Violations of the Federal Securities Laws - Jury Trial Demanded | |||
| Case Name and/or Number: Gerry Hageman, et al. v. The Charles Schwab Corporation, et al. | |||
| Type: Complaint | Date on the document: 3/31/2008 | ||
| Class Action Complaint for Violation of Federal Securities Laws - Jury Trial Demanded | |||
| Case Name and/or Number: Nils Flanzraich, et al. v. The Charles Schwab Corporation, et al. | |||
| Type: Complaint | Date on the document: 4/16/2008 | ||
| Class Action Complaint for Violation of the Federal Securities Laws - Jury Trial Demanded | |||
| Case Name and/or Number: Hugh John Tully, et al. v. The Charles Schwab Corporation, et al. | |||
| Type: Complaint | Date on the document: 4/16/2008 | ||
| Class Action Complaint | |||
| Case Name and/or Number: Mike Labins, et al. v. The Charles Schwab Corporation, et al. | |||
| Type: Complaint | Date on the document: 4/21/2008 | ||
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