The Bank of New York Mellon Corporation
Class Period: Feb 28, 2008 to Aug 11, 2011
Lead Plaintiff Deadline: Feb 12, 2012 + Deadline passed
Summary of Case:
A securities class action has been filed against The Bank of New York Mellon Corporation's ("BNY Mellon" or the "Company") on behalf of purchasers of the common stock of BNY Mellon who purchased or otherwise acquired BNY Mellon common stock between February 28, 2008 and August 11, 2011, inclusive (the "Class Period") and on behalf of purchasers of the Company's common stock pursuant or traceable to BNY Mellon's public offerings on or about May 11, 2009 and June 3, 2010. This case has been filed in the USDC - New York (Southern).
The Complaint alleges that Throughout the Class Period, and unbeknownst to its investors, BNY Mellon and certain of its executive officers issued a series of false and misleading statements, and omitted to disclose material information, regarding the Company's use of fraudulent practices to artificially inflate BNY Mellon's reported financial results, including by artificially increasing BNY Mellon's FX revenue, and misled investors regarding the sustainability and reasons behind the profitability of this critical line of business. While BNY Mellon's FX trading services were offered to clients as purportedly "free of charge," in truth, BNY Mellon rigged the pricing of its FX transactions in order to reap illicit profits.
Details about the Company's deceptive practices began to surface in January 2011 after two whistleblower (or qui tam) lawsuits against BNY Mellon were unsealed in Virginia and Florida.' The qui tam actions alleged that BNY Mellon charged custodial clients executing "indirect" FX trades (also known as "standing instruction" trades) manipulated FX rates that were set after BNY Mellon converted U.S. dollars into foreign funds or vice versa. Further, the charged FX rates bore no relationship to the prevailing market or Interbank rates at the time the trades were executed, and were selected after the fact by BNY Mellon solely to maximize the Company's fees.
On August 11, 2011, the Virginia Attorney General filed a Complaint in Intervention against BNY Mellon, and therein cited to numerous internal emails among BNY Mellon executives where they discussed the negative impact of providing clients "transparency" on FX fees and the impact that this would have on the Company's profitability.
As a result of these disclosures, BNY Mellon's common stock has declined over 37 percent from the date the first qui tarn action became public through the end of the Class Period. The decline is directly attributable to the market absorbing previously undisclosed information about the Company's fraudulent FX practices.
If you purchased this company's shares during the Class Period and suffered a loss or for further information about the case, please review the links below.