Meta Financial Group Inc. Investors File Lawsuit In Response To the 50% Stock Drop
MARCH 2012 - Proposed settlement preliminarily approved. Hearing will be held June 29, 2012.
According to the Notice:
The federal court has preliminarily certified, for settlement purposes only, a Class consisting of all Persons (including, as to all such Persons, their beneficiaries) who purchased or otherwise acquired the common stock of Meta Financial between May 14, 2009 and October 18, 2010, inclusive. Excluded from the Class are the Defendants; any officers or directors of Meta Financial during the Class Period and any current officers or directors of Meta Financial; any corporation, trust or other entity in which any Defendant has a controlling interest; and the members of the immediate families of J. Tyler Haahr, David W. Leedom, Bradley C. Hanson, and Troy Moore III and their successors, heirs, assigns, and legal representatives. Also excluded from the Class are those Persons who timely and validly request exclusion from the Class pursuant to this Notice.
The Settlement provides for a $2,100,000 cash Settlement Fund for the benefit of Class Members. Lead Counsel estimate that the average per-share benefit to Class Members from this Settlement will be $3.04 before deduction of Court-approved fees and expenses.
An investor in Meta Financial Group Inc. (NASDAQ:CASH) shares filed a lawsuit in the United States District Court for the Northern District of Iowa against Meta Financial Group, Inc over alleged violations of Federal Securities Laws in connection with the 50% stock drop.
According to the complaint the plaintiff alleges on behalf of purchasers of the common stock of Meta Financial Group Inc. between May 14, 2009 and October 12, 2010 that Meta Financial Group Inc and certain of its Officers issued between May 14, 2009 and October 12, 2010 a series of materially false and misleading statements related to Meta Financial Group’s business and operations in violation of the Securities Exchange Act of 1934. Meta Financial Group Inc. had as of Sept. 30, 2009 $834.78million in Total Assets. While Meta Financial Group Inc. was able to report a 12month Net Income of $3.69million on Sept. 30, 2006, it had to report a Net Loss of $1.46million on Sept. 30, 2009. CASH shares reached over $40 per share in 2007 and were able to hold $40 per share in the beginning of 2008. CASH shares traded at as little as $7.44 in March 2009. Recently shares of Meta Financial Group Inc. (CASH) fell from $32.75 on Oct. 11, 2010 to under $20 on October 13, 2010. On October 12, 2010, Meta Financial Group Inc had announced in a filing with the U.S. Securities Exchange Commission ("SEC") that the Office of Thrift Supervision ("OTS") had advised Meta Financial Group Inc, as early as October 6, that it has determined that the Meta Financial Meta Financial Group’s wholly owned subsidiary MetaBank had engaged in "unfair or deceptive acts or practices in violation of Section 5 of the Federal Trade Commission Act and the OTS Advertising Regulation in connection with the Bank's operation of the iAdvance program, and required the Bank to discontinue all iAdvance line of credit origination activity by October 13, 2010.”
Meta Financial Group’s report further stated it is anticipated that the discontinuance of the iAdvance program and the potential discontinuance of the tax-related programs "will eliminate a substantial portion of [the Company's] gross profit (net revenue less direct expenses). In addition, the discontinuance of the iAdvance program may result in elevated rates of nonpayment on outstanding iAdvance loans."