FRANKFORT, Ky. - Around 2,500 Kentucky investors are entitled to a share of a $200 million multi-state settlement made between Morgan Keegan Company and securities regulators.
Officials alleged that in 2007, Morgan Keegan made exaggerated claims about seven bond funds that were invested heavily in mortgage-backed securities and subprime products.
“Investors were led to believe, as well as the sales force, that they were actually safe bonds, when indeed they were risky because of the underlying investment,” says Shonita Bossier, director of the Division of Securities at the Kentucky Department of Financial Institutions.
A deadline is approaching for affected investors. Eligible account holders have until June 16 to file a claim form to receive a portion of the settlement.
“A lot of investors were your mom and pop investors, so a lot of investors indeed will be made whole if they submit this proof of claims form. Those investors who have not been made whole, they can still pursue private actions against Morgan Keegan,” says Bossier.
The Morgan Keegan funds lost around $1.5 billion in value. Click here for more information.