RADNOR, Pa., Oct. 12 /PRNewswire/ -- The following statement was issued today by the law firm of Schiffrin Barroway Topaz & Kessler, 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 securities of E*TRADE Financial Corporation ("E*TRADE" or the "Company") between December 14, 2006 and September 25, 2007, 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 Topaz & Kessler, LLP (Darren J. Check, Esq. or Richard A. Maniskas, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at
The Complaint charges E*TRADE and certain of its officers and directors with violations of the Securities Exchange Act of 1934. E*TRADE, through its subsidiaries, offers financial services to retail and institutional customers worldwide, including retail investments and trading, mortgage and home equity products, real estate loans, and various consumer loans. More specifically, the Complaint alleges that defendants failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company was experiencing increased delinquencies in its mortgage and home equity portfolios; (2) that the Company had failed to adequately reserve for loan losses; (3) as such, the Company would be forced to take $95 million in charge-offs and provision expenses of $245 million in the second half of 2007; (4) that the Company had failed to timely record impairments on certain securities, and as a result, such portfolios were materially overvalued; and (5) that as a result of the foregoing, the Company's statements about its 2007 financial and operational results were lacking in any reasonable basis when made.
On September 17, 2007, the Company shocked investors when it announced that it was exiting the wholesale mortgage business, restructuring its institutional brokerage business, and revising its previously issued 2007 guidance. The Company disclosed that it expected charge-offs of $95 million dollars, provision expenses of $245 million in the second half of 2007 due to an increased allowance for loan losses, and that it expected "severance, restructuring and other exit charges" to be $32 million as a result of its decision to exit and restructure the businesses. Additionally, the Company stated that it was revising its earnings guidance for 2007, and that it expected earnings per share ("EPS") of between $1.05 and $1.15 for the year, significantly lower than the Company's previously issued guidance of between $1.53 to $1.67 EPS for the year. On this news, the Company's shares fell $2.32 per share, or over 16.3 percent, over the next six trading days, to close on September 25, 2007 at $11.89 per share, on heavy trading volume.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin Barroway Topaz & Kessler which prosecutes class actions in both state and federal courts throughout the country. Schiffrin Barroway Topaz & Kessler is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world.
For more information about Schiffrin Barroway Topaz & Kessler or to sign up to participate in this action online, please visit http://www.sbtklaw.com/
If you are a member of the class described above, you may, not later than December 3, 2007, move the Court to serve as lead plaintiff of the class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Schiffrin Barroway Topaz & Kessler or other counsel of your choice, to serve as your counsel in this action.
CONTACT: Schiffrin Barroway Topaz & Kessler, LLP
Darren J. Check, Esq.
Richard A. Maniskas, Esq.
280 King of Prussia Road
Radnor, PA 19087
1-888-299-7706 (toll free) or 1-610-667-7706
Or by e-mail at
