Imperial Holdings (NYSE: IFT) has announced it cannot file its annual report on time because it was unable value its assets, according to South Florida Business Journal. The Boca Raton based company has been under investigation by the FBI, who raided their offices in September. This investigation is hindering their ability to establish a fair value for the insurance premium loans.
Also the SEC is investigating Imperial for possible securities fraud violations for their alleged misrepresentation to life insurance carriers. Until the company is able to resolve their legal issues and determine a value of their assets, they stated that they will not be able to file its annual report.
Imperial has cancelled its annual shareholder meeting and has not scheduled a new date because of the annual report filing delay. As a result Opportunity Partners has filed a lawsuit against them demanding that they hold the meeting. Recently, NY based Bulldog Investors sent a letter demanding the resignation of two members from Imperial’s board. If the shareholder meeting happens, a vote on the appointment of new directors could take place.
Imperial denies the allegations and the structured settlement business is not under investigation.
In addition to the FBI and SEC investigations, Imperial is facing numerous shareholder class action suits and has seen two major investors bail on them.
CFO and Chief Credit Officer Richard O’Connell Jr. signed a severance agreement with the company on February 15, 2012. President and COO, Jonathan Neuman, a target of the FBI investigation, took a leave of absence from the company back in January.
Boca Raton, FL--On March 8th, NY based Bulldog Investors wrote a letter to Imperial Holdings (NYSE: IFT) requesting the resignation of 2 independent board members or possibly face a proxy shareholder voting contest.
In recent months, Imperial, who purchases structured settlement annuity and life insurance policy payments for cash lump sums, has had some legal troubles. First, the FBI raided their offices in September and last month the SEC launched an investigation against the company. In addition, they’re facing several shareholder class action securities fraud lawsuits and two major investors bailed on them. Imperial denies the allegations and the structured settlement business is not under investigation.
According to the letter, several key investors would like the replace the 2 members with directors who are significant shareholders. The letter also detailed shareholder concerns regarding the massive amount of money being spent on legal issues. The shareholders also did not like the company’s choice of law firms.
The investors gave the company until March 9th to reply. So far, there has not be any public acknowledgement regarding the company’s decision.
The Securities and Exchange Commission (SEC) subpoenaed Imperial Holdings Inc. (NYSE: IFT) last week, according to The Wall Street Journal. The subpoena requested information regarding the company’s premium finance business.
According to the Imperial Premium Finance website, a premium finance transaction is when a life insurance policyholder obtains a loan against through an irrevocable life insurance trust established by the insured, to pay insurance premiums for a fixed period of time.
The SEC is requesting documents from 2007-present to investigate whether the company violated federal securities laws. Imperial went public in 2011 and on February 13, 2012 it was reported by numerous sources that the company lost 2 major investors.
Imperial Holdings signed a severance agreement with CFO and Chief Credit Officer Richard O’Connell Jr. on February 15, 2012. O’Connell will receive his base salary for 24 months and additional bonuses. Last month, Jonathan Neuman took a leave of absence from his duties as COO and President.
The company’s office was raided by the FBI in September 2011 due to an investigation by the U.S. Attorney’s Office for the District of New Hampshire. As a result of the raid, shareholders filed class action securities fraud lawsuits against them.
Previously, Imperial Holdings announced that the investigation was into its life settlement business not its structured settlement business. Imperial has denied any wrongdoings and no other company officials besides Neuman are being targeted in the probe.
Boca Raton, FL based Imperial Holdings (NY:IFT) got more bad news on Friday when 2 major investors sold their entire stakes in the company, according to the South Florida Business Journal.
The company’s office was raided by the FBI in September due to an investigation by the U.S. Attorney’s Office for the District of New Hampshire. As a result of the raid, shareholders filed class action securities fraud lawsuits against them.
Previously, Imperial Holdings announced that the investigation was into its life settlement business not its structured settlement business. Imperial has denied any wrongdoings and no other company officials besides Jonathan Neuman are being targeted in the probe.
Pine Trading reported a U.S. Securities and Exchange Commission filing on Friday that it no longer owns the 2.2 million shares of Imperial stock which represented approximately 9.5% of the company.
In another SEC filing on Friday, a three-way offshore partnership between Bahamas-based Chase Ridge Ltd., a British citizen residing in the Bahamas; and a branch office of Skarbonka Sp. in Luxembourg, sold all of 1.27 million shares in Imperial Holdings.
While other major investors haven’t jumped ship just yet, Imperial Holdings stock remains around $2.50/share up from a low of $1.55 on Sept. 28, 2011, the day after raid. The stock has not traded in the double digits since a few months prior to the raid.