NEW YORK, Feb. 3, 2012 /PRNewswire/ --Grant & Eisenhofer P.A. and Gardy & Notis, LLP have filed a class action lawsuit in the United States District Court for the Southern District of New York, Case No.12-cv-0895, on behalf of Oklahoma Firefighters Pension & Retirement System, and all similarly-situated persons and entities who purchased or otherwise acquired securities issued by The Student Loan Corporation ("STU" or the "Company") (NYSE: STU) from January 15, 2008 through September 23, 2010, inclusive (the "Class Period"). The action alleges that STU, certain of its executive officers, and certain entities affiliated with Citigroup, Inc. committed violations of the Securities Exchange Act of 1934 (the "Exchange Act").
STU, which was sold by entities affiliated with Citigroup to Discover Financial Services ("Discover") at the end of 2010, was one of the nation's leading providers of education financing products. The Company originated, managed and serviced student loans, including loans made in accordance with federally-sponsored student loan programs, as well as private education loans, arising under STU's CitiAssist program.
The complaint alleges that during the Class Period STU, and certain controlling individuals and entities of STU, made fraudulent material misrepresentations and omissions regarding STU's business and operations. Among other things, the complaint alleges that defendants materially misrepresented and/or failed to disclose the following adverse facts: (i) that the Company was experiencing high loan default and charge-off rates; (ii) that the Company had failed to engage in proper due diligence and underwriting in extending loans to high risk individuals/students; (iii) that the Company failed to properly and timely write down its non-performing loan portfolio assets by taking impairment charges required by Generally Accepted Accounting Principles ("GAAP"), and (iv) that the Company failed to charge adequate loan loss provisions for its loan portfolio in accordance with GAAP given the large, probable losses that were likely to be incurred.
On September 23, 2010, the Company released a statement describing the transactions pursuant to which STU would be acquired by Discover. In connection with this release, STU admitted that it had to take an impairment charge of almost $1 billion because certain loan assets had been carried on STU's books at inflated values.
Plaintiff seeks to recover damages on behalf of all purchasers of STU common stock during the Class Period (the "Class"). The plaintiff is represented by Grant & Eisenhofer and Gardy & Notis, which have expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
If you purchased or acquired STU securities from January 15, 2008 through September 23, 2010, and you wish to serve as lead plaintiff, you may move the Court no later than 60 days from today (no later than April 3, 2012). Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain a member of the proposed class.
If you wish to discuss this action or have any questions concerning this notice, please contact:
GRANT & EISENHOFER P.A.
Daniel L. Berger, Esq.
485 Lexington Avenue
New York, New York 10017
GARDY & NOTIS, LLP
Meagan Farmer, Esq.
501 Fifth Avenue, Suite 1408
New York, New York 10017
SOURCE Grant & Eisenhofer P.A.; Gardy & Notis, LLP