San Diego, CA -- (SBWIRE) -- 06/24/2014 -- An investigation for long-term investors in The First Marblehead Corporation (NYSE:FMD) shares over potential breaches of fiduciary duties by certain First Marblehead directors and officers was announced.
Investors who purchased shares of The First Marblehead Corporation (NYSE:FMD) in early 2010 or earlier and currently hold any of their NYSE:FMD shares, have certain options and should contact the Shareholders Foundation at firstname.lastname@example.org or call +1(858) 779 - 1554.
The investigation by a law firm concerns, among other things, whether certain First Marblehead officers and directors breached their fiduciary duties and caused damage to the company and its shareholders.
On August 15, 2013, The First Marblehead Corporation reported its fourth quarter and full year financial results. Among other things, The First Marblehead Corporation also provided an update on the IRS audit. The First Marblehead Corporation said that its federal income tax returns have been under audit by the IRS in connection with the sale of the trust certificate of the NC Residual Owners Trust ("Trust Residuals"). The First Marblehead Corporation said that as part of that audit process, it expects to receive a Notice of Proposed Adjustment ("NOPA"). The First Marblehead Corporation said that while the NOPA, when issued, is an initial IRS position and not a final determination, and as a result, does not require any tax payment at this time, it expects that the NOPA would seek to disallow the loss that generated the tax refunds previously received by the Company as well as require the Company to include in its tax returns any taxable income of the Trust Residuals from the March 31, 2009 sale date through June 30, 2011. The First Marblehead Corporation said that the disallowance of the loss, coupled with the additional taxable income after the sale date, creates a proposed adjustment which The First Marblehead Corporation estimated to be approximately $300 million plus interest.
In late August 2013 a lawsuit was filed against The First Marblehead Corporation over alleged securities laws violations. The plaintiff alleges that the defendants made false and/or misleading statements and/or failed to disclose that The First Marblehead Corporation’s tax treatment for its sale of the Trust Certificate and similarly situated securities was inappropriate, that such treatment exposed the Company to significant liability, threatening the future viability of the Company, that The First Marblehead Corporation lacked adequate internal controls over financial reporting, and that as a result of the foregoing, The First Marblehead Corporation’s financial statements were materially false and misleading at all relevant times.
Shares of The First Marblehead Corporation split 1:10 on December 2, 2013. Since then NYSE:FMD shares declined from $7.49 per share on December 3, 2013 to $4.10 per share on early June 2014.
On June 20, 2014, NYSE:FMD shares closed at $4.63 per share.
Those who purchased shares of The First Marblehead Corporation (NYSE:FMD), have certain options and should contact the Shareholders Foundation.
Shareholders Foundation, Inc.
3111 Camino Del Rio North - Suite 423
92108 San Diego