Key Developments For CompuCredit Holdings Corporation
CompuCredit Holdings Corporation (CCRT.O) (Nasdaq)
CompuCredit Corporation Completes Reorganization
CompuCredit Corporation and CompuCredit Holdings Corporation announced that they have completed a reorganization establishing CompuCredit Holdings Corporation as a Georgia holding company. Under a plan of reorganization approved by CompuCredit Corporation shareholders on June 29, 2009, CompuCredit Corporation, a Georgia corporation, became a wholly owned subsidiary of CompuCredit Holdings Corporation, a Georgia corporation, and the former shareholders of CompuCredit Corporation became shareholders of CompuCredit Holdings Corporation, with the same number and percentage of shares of CompuCredit Holdings Corporation as they held of CompuCredit Corporation. The common stock of CompuCredit Holdings Corporation will commence trading on the NASDAQ Global Select Market on July 1, 2009 under the ticker symbol 'CCRT' the same symbol under which the shares of CompuCredit Corporation common stock traded.
CompuCredit Corporation Reaches Agreement With FDIC and FTC
CompuCredit Corporation announced that it has reached a settlement with the Federal Deposit Insurance Corporation (FDIC) and the Federal Trade Commission (FTC) to resolve their regulatory inquiries regarding the Company's credit card marketing practices. The settlement with the agencies relates to marketing practices from 2005 and prior years, does not require any change to CompuCredit's existing marketing or servicing practices and does not have a material impact on CompuCredit's financial condition. The settlement covers customers throughout the United States and provides for CompuCredit to credit approximately $114 million to certain customer accounts that were opened between 2001 and 2005 and subsequently charged off or were closed with no purchase activity. This amount involves mostly non-cash credits -- in effect, reversals of amounts for which payments were never received. Cash refunds to consumers are estimated to be approximately $3.7 million, and the Company also agreed to pay $2.4 million to the U.S. Treasury.
CompuCredit Corporation Lowers Credit Pact To $400 Million-DJ
Dow Jones reported that CompuCredit Corporation said that it has lowered the availability under a credit facility to $400 million from $450 million. According to a filing with the Securities and Exchange Commission, the Company also extended the termination date of the facility to October 30, 2010.
Chitwood Harley Harnes LLP Files Class Action Against CompuCredit Corporation
Chitwood Harley Harnes LLP announced that a class action lawsuit has been filed against CompuCredit Corporation and various individuals on behalf of purchasers of CompuCredit common stock during the period of November 6, 2006 and June 9, 2008, inclusive (the Class Period). The case, filed in the United States District Court for the Northern District of Georgia, alleges that CompuCredit and certain of its officers and directors violated the Securities Exchange Act of 1934. According to the complaint, Defendants materially misrepresented the Company's solvency in violation of the federal securities laws in the following manner: (a) Defendants publicly praised the strength and integrity of the Company's credit card marketing and collections services and its customer friendly products, when in fact the Company was engaging in deceptive and fraudulent marketing and collection practices; (b) Defendants falsely touted the growth of the Company's credit card business without disclosing that such growth was based on fraudulent conduct and that the Company faced material risk of rescission of the fees and payment of massive fines; (c) Defendants claimed the Company was in compliance with applicable federal regulations even though its marketing and collecting practices violated such regulations; and (d) Defendants misrepresented the FDIC and FTC investigations into the Company's accounting practices.
Bronstein, Gewirtz & Grossman, LLC Announces That A Class Action Has Been Filed Against CompuCredit Corporation
Bronstein, Gewirtz & Grossman, LLC announced that a class action lawsuit has been filed in the United States District Court for the Northern District of Georgia against CompuCredit Corporation and various individuals on behalf of purchasers of CompuCredit securities who purchased between November 6, 2006 and June 9, 2008 (the Class Period). The complaint alleges CompuCredit issued materially false and misleading statements regarding the Company's business and financial results. As a result of CompuCredit's false statements, its stock traded at artificially inflated prices during the Class Period, reaching its Class Period high of $40.61 per share on December 12, 2006.
