NAPLES, Fla., Oct. 23, 2008 (GLOBE NEWSWIRE) -- As part of its investigation on behalf of Schwab YieldPlus Fund investors, the Thomas F. Shine-Christopher T. Vernon legal team has discovered that former high-profile Schwab fund manager, Kimon Daifotis, has been replaced as the fund's lead portfolio manager and has been terminated by Charles Schwab, the brokerage firm.
Shine and Vernon were the first attorneys to file an investor claim naming Daifotis as a respondent. One day after filing that claim in June, Charles Schwab announced that it had replaced Daifotis as the YieldPlus Fund manager.
The revelation about Daifotis' departure and his termination by brokerage firm Charles Schwab is part of an investor rights claim filed today by the Shine-Vernon legal team on behalf of a retired U.S. Air Force officer and nurse anesthetist from Texas.
The investor rights' legal team headed by former Securities and Exchange Commission attorney Shine and investor rights' attorney Vernon has filed claims on behalf of Schwab YieldPlus investors in California, New York & Texas during the month of October. The claims follow earlier claims filed in Florida and Hawaii. The team is preparing to file claims on behalf of investors in New Mexico, Missouri, Minnesota, and Illinois and is interviewing clients from other states as well.
Charles Schwab marketed its YieldPlus Fund as a safe and conservative "cash alternative" and compared its safety to that of one and two-year certificates of deposit, but investors have seen the bond mutual fund's price fall by almost 40 percent during the past sixteen months. More and more investors are seeking to file claims with the Financial Industry Regulatory Association seeking legal recourse.
The claims, including one filed today on behalf of the Texas investor, assert that Charles Schwab deceived YieldPlus investors with the reckless mortgage and asset-backed security strategy orchestrated in the Schwab YieldPlus Fund. The claim contends that Charles Schwab committed gross misconduct when it embarked on a "damage control" campaign to avoid liquidations of YieldPlus by its clients. Behind the scenes, Schwab quietly dumped 2.9 million YieldPlus shares from the portfolios of its other mutual funds during that time-- from Jan. 31, 2008 to April 1, 2008.
Investors represented by the Shine-Vernon legal team also claim that Charles Schwab and Daifotis misrepresented the safety of YieldPlus and failed to disclose material facts to investors about the fund. The bond mutual fund's price has decreased by almost 40 percent during the past sixteen months. This price decrease has resulted in the virtual liquidation of the Schwab YieldPlus Fund (SWYSX, SWYPX) with the fund's total net assets under management declining by more than $13 billion or-- 96 percent-- over the past year.
Investors have been encouraged by a recent case in which a FINRA arbitration panel awarded a Schwab YieldPlus Fund investor more than $500,000.
Independent investment advisors who use Charles Schwab as a platform have referred clients to the Shine-Vernon legal team, and some are even considering their own recourse in the face of damage to their business reputations and loss of clientele due to misrepresentations surrounding the safety of the Schwab YieldPlus Fund.
Shine, a former enforcement attorney with the Securities and Exchange Commission in Washington, D.C., is in private practice in the Melbourne, Fla. area. Securities attorney Chris Vernon is a founding partner of the Naples, Fla. based law firm Vernon Healy, which represents investors throughout the United States.
CONTACT: Thomas F. Shine, attorney at law, 321-724-4445, 1-800-838-8320, tfshine@aol.com, http://www.thomasfshinelaw.com/, http://www.thomasfshinelawblog.com/
Christopher T. Vernon, attorney at law, 239-649-5390, 1-877-649-5394, cvernon@vernonhealy.com, http://www.vernonhealy.com/, http://www.protectinginvestors.com/