LOS ANGELES, April 6, 2007 (PRIME NEWSWIRE) -- Notice is hereby given that Glancy Binkow & Goldberg LLP has filed a Class Action lawsuit in the United States District Court for the Southern District of California on behalf of a class (the "Class") consisting of all persons or entities who purchased or otherwise acquired the common stock of Accredited Home Lenders Holding Co. ("Accredited" or the "Company") (Nasdaq:LEND) between November 1, 2005 and March 12, 2007, inclusive (the "Class Period").
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 to 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 Accredited and certain of the Company's executive officers with violations of federal securities laws. Among other things, plaintiff claims that defendants' material omissions and dissemination of materially false and misleading statements concerning the Company's financial performance caused Accredited's stock price to become artificially inflated, inflicting damages on investors. Accredited and its subsidiaries operate as a mortgage banking company in the United States and Canada, which originates, finances, securitizes, services and sells "non-prime" or "sub-prime" mortgage loans secured by residential real estate. The Complaint alleges that during the Class Period defendants knew but failed to disclose material adverse facts about the Company's financial well-being, business relationships, and prospects, including that: (1) the Company was improperly accounting for loan losses as conditions in the sub-prime industry deteriorated; (2) as a result, the Company's financial statements were materially misstated; (3) the Company's underwriting guidelines were not adequately restrictive for borrowers in the sub-prime loan market; (4) the Company would be forced to further tighten its underwriting guidelines which would have a material impact on its future loan production; (5) the Company was operating without effective risk management policies and procedures in place; (6) the Company lacked adequate internal and financial controls; and (7), for the foregoing reasons, the Company's statements about its financial well-being and future business prospects were lacking in any reasonable basis when made.
On February 14, 2007, Accredited reported its financial and operating results for the fourth quarter and year ended December 31, 2006, emphasizing that it had "continued to increase reserve balances" by increasing the Company's total reserves by $42 million for the quarter, and was maintaining "strong liquidity."
Less than one month later, on March 12, 2007, Accredited shocked investors when the Company revealed that its cash resourses had effectively been depleted, and that the Company was now forced to explore strategic options for continued survival. The Company further revealed for the first time that it had been forced to pay approximately $190 million in margin calls since January 1, 2007, one-third of which had been received prior to the Company's February 14, 2007 announcement. The Company further revealed that it was forced to seek financial waivers and extensions of the covenants it had made with its financial lenders. As a result of this news, analysts predicted that the Company could face liquidation and possible bankruptcy, causing Accredited shares to decline $7.43 per share, or 65 percent, to close on March 13, 2007 at $3.97 per share, on unusually heavy trading volume.
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 May 15, 2007, 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.primenewswire.com/ca