CIT InterNotes Investor Claims Being Reviewed by Lawyers
A number of securities fraud lawyers are investigating whether investors who were sold CIT InterNotes were defrauded by the brokerage firms that recommended and sold the inverstments, to determine whether individuals may be entitled to recover their investment loss.
CIT, a 101-year old commercial lender, declared bankruptcy at the beginning of November after falling $64.9 billion in debt, even after receiving assistance from the federal bank bailout program.
As the company’s financial situation worsened and institutional investors began to shy away, CIT began selling InterNotes to retail investors through major banks and brokerages, such as Bear Sterns, Citigroup, Merrill Lynch, Charles Schwab, Morgan Stanley, Wachovia Securities and others.
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Learn MoreSome investors claim that they were sold the CIT InterNotes as stable and conservative investments, without full disclosure of the company’s financial situation, which should have been known by major investment firms. The notes dropped in value as the company lost value and its bonds were downgraded. According to press releases issued by several law firms, investors who were sold the notes may be able to recover their losses through a CIT InterNotes arbitration claim against their broker.
The Financial Industry Regulatory Authority (FINRA) is also investigating the sales practices involved with the distribution of CIT notes. FINRA is a non-governmental regulatory body that oversees more than 5,000 brokerage firms throughout the United Staters.
Investors are able to resolve disputes through FINRA arbitration panels for stock broker fraud claims such as breach of fiduciary duty, negligence, misrepresentation, breach of contract, unauthorized trading and other claims that investments were improperly handled.
CIT reported $3 billion in losses over the past two years, and its problems continued despite receiving $2.3 billion from the U.S. Treasury as part of the bank bailout on December 31, 2008. Treasury officials have said that it is not likely that taxpayers will get the money back.
The failure of CIT is the largest financial institution to fall since Washington Mutual’s assets were seized by regulators in September 2008. It is the fifth largest bankruptcy in history, in terms of asset value.
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3 Comments
joseDecember 31, 2009 at 1:30 pm
I´m in the same situation. I was holding 600.000 shares of CIT before it was on the OTC, and I think that all of us must claim formaly to the CIT GROUP INC. We can not acept a robery like that, we are talking about a country as USA and its TARPS.
eugeneDecember 29, 2009 at 10:08 am
yes to the above writer,i have almost exactly same situation.100,000 i was holding cit,then citgq,now they come out with same symbol,but all old shares are wiped out. how can this be. it was ok to buy the shares when it was 1.50,1.00 .90 cents. like fre ,fnm,.abk c... and many more. then they go bankrupt on a sunday. and on all investment sites i read cit is going to recover in future...... [Show More]yes to the above writer,i have almost exactly same situation.100,000 i was holding cit,then citgq,now they come out with same symbol,but all old shares are wiped out. how can this be. it was ok to buy the shares when it was 1.50,1.00 .90 cents. like fre ,fnm,.abk c... and many more. then they go bankrupt on a sunday. and on all investment sites i read cit is going to recover in future...... but no one cares about the regular guy,invests whatever he can for future.and they did this.... i loose all hope this system
JohnnyDecember 17, 2009 at 6:44 pm
I had over 200,000 shares of CIT. All purchased in the last 90 days. Over half of the shares were bought under CIT. Then they went into BK status and I purchased more. Then after regaining their CIT status under new structure I lose EVERYTHING! Now they are trading under the same name CIT! At $29 a share I have lost over $5million? There must be some rights that I have. If there is a class actio[Show More]I had over 200,000 shares of CIT. All purchased in the last 90 days. Over half of the shares were bought under CIT. Then they went into BK status and I purchased more. Then after regaining their CIT status under new structure I lose EVERYTHING! Now they are trading under the same name CIT! At $29 a share I have lost over $5million? There must be some rights that I have. If there is a class action lawsuit I would love to be the spoke person. I am Bi-racial just like Obama and my earliest child hood memory is living in a battered women’s shelter. I come from very hard times and as a young business person who has redeemed himself from the pits of hell. I feel like the system should have something in place to protect honest investors who believe in the American Dream of Free Enterprise!