Ashley Milano  |  April 10, 2015

Category: Legal News

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Ally Financial Inc.Securities fraud is an increasingly widespread problem for individual and institutional investors.

As recent headlines demonstrate, shareholders are too often the most severely affected victims of financial mismanagement and manipulation by companies and the professionals who assist them. One of these potential securities fraud offenders is Ally Financial Bank.

Ally Financial Bank is currently under investigation by securities fraud attorneys who are filing securities fraud cases on behalf of investors who suffered significant financial losses because they bought Ally Financial stock between April 2014 and the present and lost investment value as the market responded to the disclosure of the stock fraud.

This is not the first time Ally Financial has been under scrutiny for U.S. securities law violations. In 2011, the bank was named as a defendant in litigation involving mortgage fraud and was also one of several banks sued by the FDIC for allegedly selling substandard mortgage-backed securities to other financial institutions.

What is Securities Fraud?

Generally, when a financial company like Ally Financial encourages a client to invest in unnecessarily risky ventures that devalue the client’s assets or when the financial professional acts without the client’s knowledge, it is referred to as securities fraud.

Common securities fraud schemes include:

  • Accounting fraud: recognizing false revenues or income, improperly accounting for costs and/or expenses, or creating shell entities to hide debt
  • Management malfeasance: insider trading or self-dealing, backdating or other manipulation of stock options, or improper inside loans
  • Stock fraud: occurs when the issuer of the security makes false statements about the company’s status or fails to disclose important facts that may affect stock value, causing investors to buy or sell stocks under false pretenses.

What is a Securities Class Action?

A securities class action is a lawsuit filed by investors who bought or sold a company’s securities within a specific period of time and suffered economic injury as a result of securities law violations.

In cases involving misleading statements or omissions, a class period generally starts when a company, allegedly like Ally Financial, makes an untrue statement of material fact about the company or fails to disclose a material fact necessary to render other statements not misleading.

Benefits of Securities Class Action Lawsuits

Investors have rights when an investment firm, brokerage firm or registered financial advisor is negligent, fraudulent, violates the state and federal securities laws or breaches fiduciary duties to clients. State and federal securities laws, including the rules and guidelines governing self-regulatory organizations, exist to provide protection for investors.

Keeping this protection intact is the very reason that the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA) and individual states provide regulation over the securities industry.

Each year, investors lose billions of dollars as a result of the unethical, conflicted and fraudulent practices of financial institutions, like Ally Financial. Oftentimes, investors simply assume there is nothing that can be done to recover their financial losses. Class action lawsuits may be a viable option for victims of financial fraud.

A securities class action lawsuit allows individuals to legally join with other individuals who have similar experiences. Generally, investors select a class action lawsuit because the collective injuries of the plaintiffs are much more significant when taken together versus an individual filing a single claim.

Join a Free Ally Class Action Lawsuit Investigation Into Securities Fraud

Securities fraud lawyers are actively looking for investors who purchased Ally stock between April 2014 and the present and suffered financial losses. See if you qualify to join this FREE class action lawsuit investigation by clicking “Join Now” below.

Join Now

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