Below is the first part of an article By Christopher Hoffman form nhregister.com. It reads…
NEW HAVEN » A class-action lawsuit filed this week alleges that Higher One and some of its top executives knowingly misled shareholders about its finances and the legality of its business practices.
As a result, shareholders suffered significant financial losses when the company announced May 12 that it faces Federal Reserve penalties so large it could default on a loan, the suit alleges.
The revelations caused the company’s stock to tumble 14 percent to $5.51 a share, says the action filed by Goldman, Gruber & Woods of Trumbull and Pomerantz LLC of New York.
“As a result of the dissemination of the aforementioned false and misleading reports, releases and public statements, the market price of Higher One securities was artificially inflated,” the action claims. “In ignorance of the adverse facts concerning Higher One’s business and financial condition which were concealed by defendants, plaintiff and the other members of the class purchased or otherwise acquired Higher One securities at artificially inflated prices.”