New York, NYMorgan Keegan has come under fire by a Financial Industry Regulatory Authority (FINRA) arbitration panel, for what it termed "gross negligence:" Morgan Keegan had invested all $200,000 belonging to Jeffrey and Marisel Lieberman into a Fairfield Greenwich Group fund –which invested all its funds with Bernard Madoff.
FINRA cleared Julio Almeyda, the Lieberman's financial advisor and awarded the Liebermans more than $265,000, which represents their full investment plus 6 percent annualized interest, as well as $50,000 in damages and $14,000 to cover the costs of the expert witnesses called to testify on behalf of the couple.
The arbitrators wrote that "there is clear and convincing evidence" that "Morgan Keegan was grossly negligent in not performing substantial due diligence and as a result it fraudulently misrepresented the risk of this investment."
Lawsuits have been filed against Morgan Keegan alleging that the defendants either misrepresented or did not disclose certain material facts about Regions Morgan Keegan Funds to investors. As a result, investors with money in those Morgan Keegan Bond Funds allegedly lost a large amount of money. The RMK Funds in question include the Select Intermediate Bond Fund ("MKIBX") and the Select High Income Fund ("RHIIX"). The Regions Morgan Keegan lawsuit was filed on behalf of investors who acquired shares of either of the RMK funds between December 6, 2004, and October 3, 2007.