Ally Financial Under Investigation for Possible Securities Fraud

Ally Financial, with an estimated 15 million customers worldwide, provides a range of services including auto and corporate financing, mortgage services, insurance service, and online banking for its consumers.

Ally reported $151.8 billion in company assets in fiscal year 2014. But the company is now under investigation for potential securities fraud allegedly occurring since April 2014 involving sale of the bank’s stock. An Ally securities fraud class action lawsuit investigation has been launched to probe potential securities violations and Ally shareholders who bought the bank’s stock since April 2014 may be eligible to participate.

Securities fraud is a term that covers a range of illegal activities, but they all involve deceiving investors and/or the manipulation of financial markets.

According to the FBI’s website, some forms of securities fraud that Ally Financial and other banks are being investigated for allegedly committing include:

• High yield investment fraud
• Ponzi schemes
• Pyramid schemes
• Advanced fee schemes
• Foreign currency fraud
• Broker embezzlement
• Hedge fund related fraud
• Late day trading

Of these, the most common securities frauds are high yield investment fraud, and Ponzi and pyramid schemes.

High yield investment fraud is typically characterized by promises to investors of high return rates with little or no risk, coming across as “too good to be true” investment opportunities. These investment offers are generally unsolicited and promote securities, commodities, real estate, precious metals, and other popular investment forms.

Ponzi and pyramid schemes are frauds that use money collected from new victims to pay the high investment returns that were originally promised to early investors. Because these types of fraud pay at least some investors, they have the façade of being legitimate business, although the reality is that the new investors are the only source of funding.

This is not the first time Ally has faced litigation for alleged securities fraud and misconduct. During 2011, Ally was one of 18 different banks sued by the FDIC (Federal Deposit Insurance Corp.) and the Federal Housing Finance Agency (FHFA). Ally and other banks were sued by these agencies for allegedly selling subpar mortgage securities to Freddie Mac and Fannie Mae, leading to a severe financial crisis.

Additionally, Ally was also sued by the FDIC for allegedly selling defective mortgage securities to other financial institutions. These securities eventually failed and were taken over by the FDIC.

In 2013, Ally settled both securities lawsuits against the bank and agreed to pay $55.3 million to the FDIC and an additional $475 million to the FHFA.

An Ally securities class action lawsuit could result in a verdict for plaintiffs, allowing Ally stock investors to recover financial losses stemming from misrepresentation, deceit, and other types of alleged investment fraud.

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.

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