NEW YORK, July 11, 2006 (PRIMEZONE) -- The Rosen Law Firm today announced that it has commenced an investigation into allegations that Sunterra Corporation ("Sunterra" or the "Company") (PinkSheets:SNRR) violated the federal securities laws by issuing materially false and misleading financial results for the fiscal years ended December 31, 2002 to September 30, 2005 and the first quarter ended December 31, 2005.
On March 23, 2006 the Company's independent auditor Grant Thornton, LLP sent the SEC a previously undisclosed letter from a former employee of Sunterra detailing allegations concerning certain "accounting practices" of the Company's Spanish Operations. On March 27, 2006 the Company announced that it had terminated Grant Thornton as its independent auditor. On May 2, 2006, the Company terminated its Managing Director of Sunterra Europe.
On May 3, 2006 the Company announced that its financial results for the fiscal years ended December 31, 2002 to September 30, 2005 and the fiscal quarter ended December 31, 2005 contained material inaccuracies and should no longer be relied upon.
On June 22, 2006, the Company announced that it had placed its CEO, Nicholas J. Benson, on administrative leave pending the completion of the Company's investigation into the Company's accounting practices and the allegations by the former employee. That same day, the Company announced that its CFO, Steven E. West, had resigned. As a result of these adverse disclosures, the Company's stock declined nearly 50%. Subsequently, on July 6, 2006, the Company's stock was de-listed from the Nasdaq.
As a result of these allegations, the Rosen Law Firm is preparing a class action lawsuit on behalf of investors who purchased Sunterra stock during the period from April 15, 2003 through June 22, 2006.
You may access the website at http://www.rosenlegal.com to participate in the proposed class action.
If you purchased shares of Sunterra stock and would like further information concerning your legal rights, please contact Laurence Rosen, Esq. or Phillip Kim, Esq. toll-free at 866-767-3653 or email lrosen@rosenlegal.com or pkim@rosenlegal.com or visit the website at www.rosenlegal.com.
The Rosen Law Firm has expertise in prosecuting investor securities litigation and extensive experience in actions involving financial fraud. The Rosen Law Firm represents investors throughout the nation, concentrating its practice in securities class actions.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca