FXCM Inc hit by Investor Lawsuit over alleged Securities Laws Violations

March 7, 2011 - PRLog -- Following a lawsuit by a customer alleging violation of the Racketeer Influenced and Corrupt Organizations Act an investor in shares of FXCM Inc   filed a lawsuit in the United States District Court for the Southern District of New York against FXCM Inc alleging violations of Federal Securities Laws.

If you purchased FXCM Inc  common stock pursuant to its December 2010 Initial Public Offering of 15,060,000 shares of common stock, you have certain options and there are short and strict Deadlines running. Deadline: May 2, 2011. Those FXCM stockholders you should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

According to the complaint the plaintiff alleges that FXCM Inc, its Board of Directors at the time of the IPO, and the certain Underwriters involved in the December 2010 Initial Public Offering violated the Securities Act of 1933 by including or allowing the inclusion of materially false and misleading statements in the Registration Statement and Prospectus. In early December 2010, FXCM sold more than 15 million shares at the price of $14 per share in its IPO. Shares of FXCM Inc  then rose on December 3, 2010 to $15 and then decreased on Dec 20 to as low as $12.21 per FXCM share.
Specifically the lawsuit alleges that Defendants each failed to conduct an adequate due diligence investigation into FXCM Inc prior to the December 2010 IPO, and they also each failed to reveal, at the time the December 2010 IPO closed that FXCM Inc. was not proceeding according to plan, that FXCM’s growth and trading volume had slowed or weakened by the time of the December 2010 IPO, which would make it impossible for FXCM to achieve its projected results sponsored and/or endorsed by Defendants prior to and at the time of the IPO. Moreover, Defendants failed to disclose the true nature of its operations.

Then on February 10, 2011, FXCM Inc disclosed that it was sued in the United States District Court for the Southern District of New York by a customer alleging claims under Federal and New York State law with respect to trading through the company’s platforms.

The consumer alleges that FXCM Inc  has been engaged for years in a fraudulent scheme in violation of the Racketeer Influenced and Corrupt Organizations Act (“RICO”) that has “bilked thousands of customers out of hundreds of millions of dollars,” in part by using software designed “to interfere with customers’ trades.”

Equities research analyst William Katz at Citi Investment meanwhile cut earnings estimates for the Company for 2011 and 2012, and lowered the price target for the stock from $18 to $14. Katz wrote in a research note that the year-to-date data have raised questions about growth assumptions for the Company this year and next year, and “begin to suggest potentially greater maturity in the business than previously contemplated.”

After the announcements FXCM shares fell to under $12.

Those who purchased FXCM Inc  common stock pursuant to its December 2010 Initial Public Offering of 15,060,000 shares of common stock, have certain options and there are short and strict Deadlines running. Deadline: May 2, 2011. Those FXCM stockholders you should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

# # #

The Shareholders Foundation, Inc. is a professional portfolio legal monitoring service and an investor advocacy group. We do research related to shareholder issues and inform investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. At Shareholders Foundation, Inc. we are in contact with a large number of shareholders. We believe that together we can combine the interests of many investors, and use the size of our interest as leverage against the giant corporations. We offer help, support, and assistance for every shareholder. We help investors find answers to their questions and equitable solutions to their problems. The Shareholders Foundation, Inc. is not a law firm. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.