ATLANTA, Oct. 22, 2009 (GLOBE NEWSWIRE) -- This press release serves to amend Napoli Bern Ripka's previous press release on September 30, 2009. The Law offices of Napoli Bern Ripka LLP has won an arbitration against the brokerage firm Morgan Keegan & Co., Inc. and the first arbitration victory against James C. Kelsoe - Morgan Keegan's fund manager.
Morgan Keegan, is a Memphis, Tennessee based brokerage firm that sold mutual funds and other investments based on false information and misrepresentations about the funds. Morgan Keegan's bond funds were overcollateralized by underlying assets in risky securities.
The RMK Funds, which included RMK High Income Fund (formerly RMH, currently HIH), RMK Advantage Income Fund (formerly RMA, currently HAV), RMK Multi-Sector High Income Fund (formerly RHY, currently HMH), RMK Strategic Income Fund (formerly RSF, currently HSA), RMK Select High Income Fund (formerly MKHIX, currently HIFAX), and the RMK Select Intermediate Fund (formerly MKIBX, currently HSIBX), were marketed and recommended as providing investors with a consistent level of income. Despite these representations, the RMK Funds invested in mortgage-backed securities, many of which contained sub-prime mortgage loans and collateralized debt obligations. In six short months these funds dropped in value by over 70%. The risks associated with these securities resulted in substantial losses for investors in the RMK Funds. Shamefully, Morgan Keegan did not properly or accurately inform RMK Fund investors of these risks.
The case was the first successful arbitration on behalf of an investor who did not directly purchase RMK Funds from Morgan Keegan. The Claimant, an elderly and unsophisticated investor, claimed that Morgan Keegan committed fraud in violation of the Securities Act of 1934. Claimant was awarded full damages, including interest, filing fees, forum fees and expert witness fees associated with the case.
Morgan Keegan has already lost a number of cases in 2009 and there are still many arbitration claims currently pending against them that allege fraud, unsuitability, misrepresentation, and other claims.
The many recent arbitration victories bode well for investors who have not yet filed a claim. If you, or anybody you know has lost money as a result of investments in Morgan Keegan bond funds, please contact us at 888-529-4669.