Securities Law Firm of Tramont Guerra Nunez, PA Comments on Recent Developments in the Fannie Mae Class Action Lawsuit

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These developments provide relief to the Defendants’ litigation risk and change significantly the claims brought by the class action Plaintiff attorneys. Many investors relied upon research analyst recommendations provided by their financial advisors which resulted in an over-concentration in the banking and financial sector. Investors in Fannie Mae securities should consider what recourse is available to recover their investment losses in stock held in full-service brokerage accounts.

The Securities Law Firm of Tramont Guerra & Nunez, P.A. (TGN) comments on the recent ruling for the Fannie Mae Class Action lawsuits consolidated under docket (1:09-md-02013-GEL) assigned to Judge Paul A. Crotty in the United States District Court Southern District of New York. United States District Judge, Paul A. Crotty, issued an Opinion and Order in response to Defendant’s Motion to Dismiss the Plaintiffs’ Joint Consolidated Amended Class Action Complaint. The decision granted the Defendant’s Motion to Dismiss allegations concerning misrepresentations concerning financial reporting of mortgage loss exposure and denied the Motion to Dismiss allegations concerning internal controls and risk management business practices. These developments provide relief to the Defendants’ litigation risk and change significantly the claims brought by the class action Plaintiff attorneys. TGN urges investors in Fannie Mae securities should consider what recourse is available to recover their investment losses in stock held in full-service brokerage accounts. The Financial Industry Regulatory Authority, (FINRA) is a self regulating organization with sales practice rules and regulations that govern the securities industry’s conduct and safeguard the investing public. For investors who invested in Fannie Mae securities, the recent developments represent a significant loss in income and investment.

According to TGN, many investors in Fannie Mae securities represented a long term holding acquired through investment, inheritance or as an employee of the company. Full-service brokerage firms are obligated to give, and investors are entitled to rely upon, brokerage firms for competent, suitable investment advice concerning risk management strategies for concentrated stock positions. Many investors relied upon research analyst recommendations provided by their financial advisors which resulted in an over-concentration in the banking and financial sector. Brokerage firms are required to supervise the activities in brokerage accounts, losses may be attributed to the failure to adequately supervise the stockbroker and the brokerage account. Recommendations of unsuitable investments and/or maintaining unprotected concentrated stock positions are both causes of action that may be available to investors against their full-service brokerage firm in an individual securities arbitration claim filed with FINRA.

The Securities Law Firm of Tramont Guerra & Nunez, PA, is a nationally recognized, Martindale Hubbell “AV” rated securities law firm. To request a confidential consultation from a TGN attorney to determine whether you have a viable individual securities arbitration claim for investment losses that exceed $250,000 from a full service brokerage account, contact us on our website. To speak directly with an attorney, call (800) 578-0137 and ask for Ben Fernandez, Esquire.

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Ben Fernandez
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