LOS ANGELES, June 20, 2005 (PRIMEZONE) -- Notice is hereby given by Glancy Binkow & Goldberg LLP that a Class Action lawsuit was filed in the United States District Court for the Southern District of New York on behalf of a class (the "Class") consisting of all persons or entities who purchased or otherwise acquired securities of R&G Financial Corporation ("R&G Financial" or the "Company'') (NYSE:RGF), between April 21, 2003 and April 25, 2005, inclusive (the "Class Period"). All persons and institutions who purchased securities of R&G Financial during the Class Period may move the Court not later than June 27, 2005, to serve as lead plaintiff, however, you must meet certain legal requirements.
A copy of the Complaint is available from the court or from Glancy Binkow & Goldberg LLP. Please contact us by phone to discuss this action or obtain a copy of the Complaint at (310) 201-9150 or Toll Free at (888) 773-9224, by email at info@glancylaw.com, or visit our website at www.glancylaw.com.
The Complaint charges R&G Financial and certain of the Company's executive officers with violations of federal securities laws. Plaintiff claims defendants' omissions and material misrepresentations during the Class Period artificially inflated the Company's stock price, inflicting damages on investors. R&G Financial is a diversified financial holding company with operations in Puerto Rico and the United States providing banking, mortgage banking, investments, consumer finance and insurance through its wholly-owned subsidiaries. The Complaint alleges that during the Class Period defendants made materially false and misleading statements concerning the Company's operations and financial performance. Unbeknownst to public investors, the true facts, which defendants knew or recklessly disregarded and failed to disclose to the investing public during the Class Period, included: (a) that the Company was using fraudulent accounting practices, including failing to record impairment losses for the deterioration in the value of residual interests retained, and materially overstated its net income, net gain on mortgage loan sales and net capital; and (b) that the Company was using ineffective risk-management and hedging strategies against the increasing risk of rising interest rates.
On April 25, 2005, defendants disclosed that the Company would need to restate its earnings for the prior two-year period. Specifically, R&G Financial disclosed that the Company's financial reports from January 1, 2003 through December 31, 2004 would incur charges to reflect impairments of $90 million to $150 million on retained residual interests. As a result of this news, R&G Financial's stock price plummeted 35%, on unusually high volume, falling $23.18 in one day.
The next day, April 26, 2005, the Company announced the Securities and Exchange Commission had commenced an investigation concerning the financial restatement announced by R&G Financial the previous day, as well as the underlying issues addressed in the Company's April 25 press release.
Plaintiff seeks to recover damages on behalf of Class members and is represented by Glancy Binkow & Goldberg LLP, a law firm with significant experience in prosecuting class actions, and substantial expertise in actions involving corporate fraud.
If you are a member of the Class described above, you may move the Court, not later than June 27, 2005, to serve as lead plaintiff, however, you must meet certain legal requirements. If you wish to discuss this action or have any questions concerning this Notice or your rights or interests with respect to these matters, please contact Michael Goldberg, Esquire, of Glancy Binkow & Goldberg LLP, 1801 Avenue of the Stars, Suite 311, Los Angeles, California 90067, by telephone at (310) 201-9150 or Toll Free at (888) 773-9224 or by e-mail to info@glancylaw.com.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca