The Shareholders Foundation announces that an investigation on behalf of current long-term investors in shares of Amtrust Financial Services, Inc. (NASDAQ:AFSI) was initiated concerning potential breaches of fiduciary duties by certain directors and officers of Amtrust Financial Services.
Investors who are current long term investors in Amtrust Financial Services, Inc. (NASDAQ:AFSI) shares, have certain options and should contact the Shareholders Foundation at mail(at)shareholdersfoundation.com or call +1(858) 779 – 1554.
The investigation by a law firm for current long term investors in NASDAQ:AFSI stocks follows a lawsuit filed recently against Amtrust Financial Services, Inc. over alleged securities laws violations. The investigation on behalf of current long term investors in Amtrust Financial Services stocks concerns whether certain Amtrust Financial Services officers and directors are liable in connection with the allegations made in that lawsuit.
According to that complaint filed in the U.S. District Court for the Southern District of New York the plaintiff alleges that Amtrust Financial Services, Inc. violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder.
More specifically, the plaintiff claims that defendants made allegedly false and/or misleading statements and/or failed to disclose that Amtrust Financial Services, Inc. manipulated its loan loss reserves in order to inflate reported earnings, that Amtrust Financial Services, Inc. manipulated its deferred tax liabilities, that Amtrust Financial Services, Inc. underestimated the discount rates for its life settlement contracts in an effort to inflate the Company’s reported assets and total stockholder’s equity, that Amtrust Financial Services, Inc. lacked adequate internal and financial controls, and that as a result of the foregoing, Amtrust Financial Services, Inc. ‘s statements were materially false and misleading at all relevant times.
On December 12, 2013, a report was published that alleged that Amtrust Financial Services, Inc. has long exaggerated its true financial condition by, among other things, excluding losses of its wholly-owned subsidiaries in its SEC filings, failing to disclose a total of $276.9 million in losses transferred to its Luxembourg subsidiaries from 2009 to 2012, mismarking its life settlement contracts by using overly aggressive assumptions relative to its peers despite records showing Amtrust Financial Services, Inc. holds many policies that are likely worthless, and stating different accounts in its press releases than those reported in SEC filings. The report also raised numerous other red flags of fraud at Amtrust Financial Services, Inc. that called into question the veracity of AmTrust’s public disclosures to investors.
The same day, Amtrust Financial Services, Inc. issued a statement and reported strong financial outlook. Amtrust Financial Services, Inc. said that the fundamental outlook for the Company remains positive and is responding to negative comments produced by a report circulated by parties that have a vested interest in the common shares of Company declining in value.
Shares of Amtrust Financial Services, Inc. declined from over $41.81 per share on November 29, 2013 to as low as $28.62 per share on December 18, 2013.
On June 17 2014, NASDAQ:AFSI shares closed at $42.49 per share.
Those who purchased shares of Amtrust Financial Services, Inc. (NASDAQ:AFSI) have certain options and should contact the Shareholders Foundation.
Contact:
Shareholders Foundation, Inc.
Trevor Allen
3111 Camino Del Rio North – Suite 423
92108 San Diego
Phone: +1-(858)-779-1554
Fax: +1-(858)-605-5739
mail@shareholdersfoundation.com