WEST PALM BEACH, Fla., Sept. 16, 2008 (GLOBE NEWSWIRE) -- The Law Offices of Aronberg & Aronberg announces that it has filed a class action lawsuit in Palm Beach County, Florida on September 15, 2008, on behalf of all Florida customers of Citigroup/Smith Barney brokerage who were improperly placed into Fannie Mae stock in 2008.
We believe Smith Barney placed thousands of its customers into Fannie stock this past Spring and even into the Summer months of 2008 when Smith Barney should have realized that Fannie was on the verge of collapse. Smith Barney, a holder of millions of shares of Fannie, misrepresented the true risks associated with Fannie stock. We have seen numerous complaints that Smith Barney stock brokers told customers that the risks of Fannie were minimal/non-existent and that they were both "safe" and "secure" investments. Many of our clients are elderly persons, not familiar with the inherent risks of Fannie, who should never have been convinced by their brokers to invest in this stock. Being elderly, they needed investments that would protect their principal investment. Clearly, Fannie stock was not such a product. In one case, the Florida investor was told by a Smith Barney broker that Fannie was "no risk at all." One month after that same investor bought Fannie on advice of her Smith Barney broker, the same broker told her to buy more.
Smith Barney customers were also misinformed that, in the unlikely event Fannie or Freddie went under, the government would step in and protect their investments. While this may be true with bond holders, this obviously was not the case with purchasers of Fannie/Freddie stock.
We believe that these types of misrepresentations are clearly violations of Florida's Unfair and Deceptive Trade Practices Act which prevents unfair or deceptive acts or practices in conducting of any trade or commerce.
The Class Action does not name any individual brokers or advisors as defendants. Instead, our only defendant is Citigroup/Smith Barney for making unsuitable investment recommendations and misrepresentations.
It is again our intention to see to it that the thousands of Florida Citigroup/Smith Barney customers who were recommended and misled into buying Fannie/Freddie stock are reimbursed for their losses by the company who led and recommended that they buy these unsafe investments.
The Law Offices of Aronberg & Aronberg is active in litigation pending both in federal and state courts. You may visit our web site at www.aronberglaw.com or www.smithbarneyclassaction.com for information.
More information on this and other class actions can be found on the Class Action Newsline at www.globenewswire.com/ca