MORGAN KEEGAN SUED BY CHARITY FOR TERMINALLY ILL CHILDREN FOR IMPROPER INVESTMENTS
Early this month Morgan Keegan & Co. settled a lawsuit with the Indiana Children’s Wish Fund. This fund, which tries to help terminally ill children fulfill their last wishes, lost nearly $50,000 investing with Morgan Keegan. The primary culprit was the Regions Morgan Keegan Select Intermediate Bond Fund.
Andy Meek of The Daily News said the Indiana charity “was one of the first investors in the group of bloodied RMK funds to file a claim or lawsuit recently saying the funds’ volatility had not been fully disclosed.” Apparently, this is the case for many of the Regions Morgan Keegan Funds, most of which have suffered tremendously from the subprime mortgage fallout. In Memphis, further lawsuits have already been filed against the RMK Select Intermediate Bond Fund and the RMK Multisector Bond Fund.
The Morgan Keegan Funds were heavily laden with risky mortgage backed securities. Individual investors were not warned about the potential volatility of these funds. The RMK funds and their managers overexposed their funds to the subprime mortgage market, and the funds investors are bearing the losses from the mortgage fallout, and the managers should have been more responsible.
Read the full story:
http://www.memphisdailynews.com/Editorial/StoryLead.aspx?id=100438
http://www.memphisdailynews.com/Editorial/StoryLead.aspx?id=100478
