FORT LAUDERDALE, Fla., Jan. 11, 2012 (GLOBE NEWSWIRE) -- The Law Firm of Sonn & Erez announces that Regions Financial Corp.'s (NYSE:RF) Morgan Keegan unit was hit again with another verdict in a FINRA arbitration case, awarding over $214,000, plus attorneys fees to a customer from Ormand Beach, Florida for losses relating to "high yield" funds sold under the RMK [Regions Morgan Keegan] brand (FINRA Case No.10-2526). The award is significant in that the FINRA panel awarded "well managed" damages, the amount that the customer would have earned had the pension funds been "well managed," and attorneys fees to the customer. Morgan Keegan's request for $200,000 of attorneys fees was denied by the arbitration panel.
This arbitration verdict comes on top of other verdicts won by Sonn & Erez, PLC, including $1.1 Million award for a WWII veteran, a $1,080,000 award for a Fort Lauderdale family, a $285,000 arbitration award for a Vietnam veteran and a $430,000 award for a retired banker. Morgan Keegan has been the subject of numerous arbitration cases relating to over $2 billion of losses in RMK bond mutual funds formerly managed by James Kelsoe, which funds were decimated due to investments in what attorneys have described as lower tranches of asset backed securities, commonly known in the structured finance and banking industry as "toxic waste."
"We believe we proved that our client's Morgan Keegan broker did not fully appreciate the extreme risks of the RMK high yield bond funds which held risky lower tranches of asset backed securities, aka 'toxic waste,'" said Jeffrey Erez, of Sonn and Erez PLC, who represented the pension fund. "We believe that many Morgan Keegan brokers were improperly used as conduits to put out false and misleading information to get their clients to purchase Morgan Keegan branded high yield bond mutual funds," added Jeffrey Sonn, Esq.
In 2011, Morgan Keegan reached a settlement with Federal, State and FINRA regulators in which it agreed to pay $200 million to settle charges that the RMK high yield funds were misrepresented to investors, among other charges.
Jeffrey Erez added, "Our pension fund client was just one of an estimated 28,000 investors who bought these RMK bond funds and we will continue to fight for these victims."
The RMK bond funds that have been the subject of hundreds of investor arbitrations were later rebranded as Helios funds, managed by Hyperion Brookfield, who took over as fund advisor in 2008, including:
Helios Advantage Income Fund
Helios High Income Fund
Helios Multi-Sector High Income Fund
Helios Strategic Income Fund
Helios Select High Income Fund
Helios Select Intermediate Income Fund
Helios Select Short Term Bond Fund
For more information, please contact Jeffrey Sonn or Jeffrey Erez at Sonn and Erez PLC.
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