BALA CYNWYD, Pa., Aug. 15, 2002 (PRIMEZONE) -- The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:
A securities class action lawsuit pending in the U.S. District Court for the Eastern District of Virginia, Alexandria Division (02-1094-A) claims that Capital One Financial Corp. (NYSE:COF) ("Capital One" or the "Company") misled shareholders about its business and financial condition.
Plaintiff seeks damages for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (and/or the Securities Act of 1933) on behalf of all investors who bought Capital One Financial Corp. securities between January 15, 2002 and July 16, 2002 (the "Class Period").
Schiffrin & Barroway, LLP has prosecuted shareholder class actions for over fourteen years and has recovered more than $1 billion for investors. If you are a shareholder of Capital One Financial Corp. and want to learn more about this lawsuit and about becoming a lead plaintiff, you may visit our website at http://www.sbclasslaw.com/cgi/signup.cgi.
The complaint alleges that the Virginia-based Capital One Financial Corp. issued numerous press releases regarding its performance during the Class Period which represented that the Company was experiencing quarter after quarter of record earnings and revenue growth while maintaining "stringent risk management practices" and adequate loan loss reserves. The complaint further alleges that these, and other, representations were materially false and misleading because they failed to disclose that Capital One was in violation of federal guidelines regarding adequate levels of capitalization and loan loss reserves and that it was not effectively managing its rapid growth. On July 16, 2002, Capital One revealed that it had entered into an agreement with regulators, which required Capital One to boost reserves by $247 million in the second quarter of 2002, tie-up additional capital and institute infrastructure reforms in order to deal adequately with its high rate of growth, especially in the subprime market. In reaction to the announcement, Capital One's stock plummeted by 39%, falling from a $50.60 per share close on July 16 to $30.48 per share by the close of July 17, on extremely heavy trading volume. During the Class Period, as alleged in the complaint, Capital One insiders, including defendant Willey, profited by selling a total of over $8.2 million in Capital One common stock at artificially inflated prices and the Company undertook a convertible debt offering for $650 million on April 19, 2002.
If you purchased Capital One Financial Corp. securities between January 15, 2002 and July 16, 2002, you may be a member of the class and have until September 17, 2002 to move the court to become a lead plaintiff. In order to serve as lead plaintiff, however, you must meet certain legal requirements. To be a member of the class, however, you do not need to take any action at this time. Should you decide to seek appointment as a lead plaintiff, you may retain Schiffrin & Barroway, or retain counsel of your choice.
To learn more about your rights and interests in this case and your ability to potentially recoup your losses, please contact Schiffrin & Barroway (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) directly at 888-299-7706 (toll free) or 610-822-2221, fax number 610-822-0002, e-mail at info@sbclasslaw.com or visit our website at www.sbclasslaw.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.