BALA CYNWYD, Pa., June 11, 2003 (PRIMEZONE) -- The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:
Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Southern District of New York on behalf of all purchasers of the securities of Federal Home Loan Mortgage Corp. ("Freddie Mac" or the "Company") (NYSE:FRE) from April 18, 2000 through June 6, 2003, inclusive (the "Class Period").
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 Schiffrin & Barroway, LLP (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at info@sbclasslaw.com.
The Complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between April 18, 2000 and June 6, 2003, thereby artificially inflating the price of Freddie Mac securities. During the Class Period, the Company issued statements that failed to disclose and/or misrepresented the following adverse facts, among others: (1) that the Company failed to properly classify hedges and assets with respectto derivative securities; (2) that the Company used "cookie jar" accounting wherein Freddie Mac deferred gains to subsequent quarters in a bid to keep its revenue and earning growth steady; (3) that the Company provided investigators with altered and misleading documents in order to conceal the Company's improper accounting; (4) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (5) that as aresult, the value of the Company's net income and financial results were materially misstated at all relevant times.
On June 9, 2003, the Company announced sweeping changes in its management team. These changes arose out of the Company January 22, 2003 announcement that it would have to restate its financial results for fiscal years 2000, 2001, and 2002. Market reaction to the news was swift. Shares of Freddie Mac fell $9.61 per share or 16 percent to close at $50.26 per share, wiping out $7 billion in market value.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin & Barroway, which prosecutes class actions in both state and federal courts throughout the country. Schiffrin & Barroway is a driving force behind corporate governance reform, and has recovered in excess of a billion dollars on behalf of institutional and high net worth individual investors. For more information about Schiffrin & Barroway, or to sign up to participate in this action online, please visit http://www.sbclasslaw.com/currentcases.cfm.
If you are a member of the class described above, you may, not later than August 8, 2003, move the Court to serve as lead plaintiff of the class, if you so choose. In order to serve as lead plaintiff, however, you must meet certain legal requirements.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca