Malecki Law takes a proactive and informed approach to the financial news of today: actively engaging in fact-finding analysis on prospective cases from around the world. Our thorough knowledge of securities law’s history and fine points makes us ideal consultants for investors who have suffered losses due to misadvice from their broker or other financial counsel. Information on a selection of funds and companies currently under investigation by Malecki Law can be found below. Our pursuit of excellence is constant, but our opportunities to make lasting positive change to the securities industry begin and end with determined clients who seek justice.
Malecki Law is currently investigating preferred stock of Fannie Mae and Freddie Mac, as sold by an array of investment firms throughout 2007 and 2008, including but not limited to UBS, CitiGroup, Morgan Stanley, and Merrill Lynch.
Preferred stock can be defined as a hybrid of equity and debt instruments: it is prioritized over common stock when paying dividends and/or after liquidation. Preferred stock has been considered an appealing financing tool: selling such stock allows companies to defer dividends without affecting their credit or defaulting.
Claims filed by investors allege that the aforementioned firms and others like them failed to disclose crucial information about the quickly deteriorating status and financial security of Fannie and Freddie. The poor condition of the companies is today said to have sprang from excessive lending, offering loans that could not be properly repaid, and investment in “toxic” assets. The term “Toxic asset” describes mortgage-backed securities, credit default swaps, collateral debt obligations, and other risky means of borrowing and lending money for real estate that perpetuated a housing crisis once the companies lending such funds became insolvent.