COLCHESTER, Conn., May 27, 2005 (PRIMEZONE) -- Scott + Scott, LLC announces that on April 21, 2005, its client filed a shareholder class action lawsuit on behalf of all purchasers of Doral Financial Corporation (NYSE:DRL) securities who purchased between October 10, 2002 and April 19, 2005 (the "Class Period"). Shares of Doral continued to drop today after the Company said that it will reduce the value of its interest-only securities by as much as $600 million and is in default on two indentures. The stock traded below $10 in the first half-hour of trading this morning. During the Class Period, the stock traded over $49.00.
Scott + Scott's complaint alleges that Doral and certain of its officers and directors violated the securities laws by improperly valuing its I/Os by using flawed loss assumption, artificially high prepayment assumptions and artificially low discount rates. As a result of such conduct, Doral's stock price traded at artificially inflated levels. The complaint alleges that while the stock price was artificially inflated certain insiders sold more than $10,000,000 in Doral stock and earned cash incentive bonuses.
If you would like information about Scott + Scott's original complaint or would like to discuss with an attorney the numerous other complaints filed against Doral please contact the firm at 800/404-7770. You can also speak with attorney Neil Rothstein at nrothstein@scott-scott.com (800/332-2259 or via cell phone 619/251-0887) or attorney Amy K. Saba at asaba@scott-scott.com (800/332-2259). Scott + Scott has offices in Connecticut, Ohio and California. The firm (http://www.scott-scott.com) specializes in complex litigation including securities fraud and represents foundations, individuals, corporations and pension funds worldwide.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.