CARSON CITY — Nevada Secretary of State Ross Miller’s Securities Division announced Thursday approval of a deal to provide restitution for 41 Nevadans who lost approximately $5 million by investing in funds whose high risks were not properly disclosed by broker dealer Morgan Keegan & Company, Inc. (MKC) and its affiliate Morgan Asset Management, Inc. (MAM).
Nevada’s order is entered in conjunction with a multi-state task force investigation that nets investors a $200 million settlement from MKC and MAM. The issues raised in the investigations include failing to adequately disclose some of the risks associated with investments in MAM’s offered funds in reports filed with the SEC; classifying approximately $400 million of asset-backed securities as corporate bonds and preferred stocks when they were the lower tranches of asset-backed structured debt instruments; using industry benchmarks not directly comparable to the investment funds; and incorrectly characterizing funds and their holdings.
An administrator will create distribution plans to affected investors. Any questions regarding rights to a reimbursement should be directed to the fund administrator: Morgan Keegan Settlement Fund Administrator, c/o A.B. Data, Ltd., P.O. Box 170500, Milwaukee, WI 53217. Affected investors also can call 888-208-9083 or 414-961-6595 or email email@example.com.