Labor & Employment Law

Charles Schwab proposes $200M settlement for investor class action suit

By Dobin & Jenks

Despite individual investors losing a reportedly $800 million, the Charles Schwab Corp. agreed last week to pay $200 million to settle a class-action lawsuit stemming from brutal mortgage-related losses in its once-popular YieldPlus bond fund.

This case has not been as high profile in the news as the Goldman Sachs case in the news, where victims were primarily banks. The class action suit against Charles Schwab Corp., involved 250,000 individual investors.

If the judge approves this class-action settlement, Schwab would be able to move on from this legal fight. Investors are expected to receive approximately 20 to 25 cents for each dollar they lost.

Schwab has paid out $48 million in settlements and awards in other arbitration cases. However, there are approximately 180 arbitration cases still pending and a class-action suit in California state court on the horizon.

Click on the following link to read more from the LA Times on the proposed Schwab $200M settlement.

Full post as published by The Law Planet Blog on April 26, 2010 (boomark / email).