Charles Schwab YieldPlus Fund Lawsuits

March 21st, 2008 by Austin Kirk | PERMALINK

Investors in Charles Schwab YieldPlus Funds may be entitled to recover some of the losses which have been suffered in recent months. False and misleading statements were made about the funds lack of diversification and the extent of the investment in risky sub-prime mortgage securities. A Charles Schwab class action lawsuit has been filed , however, individuals who lost more than $10,000 should consider filing their own Charles Schwab YieldPlus Fund lawsuit to recover their investment losses.

The financial fraud lawyers at Saiontz, Kirk & Miles, P.A. are reviewing potential Charles Schwab lawsuits for individuals who purchased shares of:

  • Schwab YieldPlus Funds Investor Shares (Nasdaq: SWYSX)
  • Schwab YieldPlus Funds Select Shares (Nasdaq: SWYPX)

The Schwab Yield Plus investment funds were initially offered in November 2004 as a safe alternative to money market accounts. They were designed to preserve capital while generating income, with relatively low risk. Contrary to the representations made to investors, Charles Schwab has invested more than 50% of the funds assets in the mortgage industry. As a result of their concentration in this single risky industry, substantial losses have been suffered.

The funds investments in sub-prime mortgage backed securities are considered risky because they are rarely traded and do not have active price quotes that are maintained. These new types of mortgage securities have not been tested through market cycles and fund managers failed to minimize the risk of losses by diversifying. In addition, investors were not informed about the extent of the risk they were exposing themselves to.

Following the collapse of the sub-prime mortgage market in July 2007, investors in Charles Schwab Yield Plus funds have suffered disproportionate losses, and they may have legal options to recover some of their investment. Similar lawsuits are being pursued by our stock fraud lawyers on behalf of investors in Morgan Keegan bond funds, which were also heavily invested in these collateralized debt obligations.

Charles Schwab class action suits have been filed for investors who purchased shares in Schwab YieldPlus funds between March 17, 2005 and March 18, 2008. However, individual lawsuits are also being reviewed as a result of the false and misleading statements made by underwriters, investment advisors and fund managers regarding the diversification of the funds.

If over $10,000 has been lost as a result of an investment in one of these funds, you or family member may be better protected by an individual Charles Schwab Fund lawsuits. Request a free consultation and claim evaluation.

Posted in Financial Fraud, News & Alerts, Other

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10 Responses to:
“Charles Schwab YieldPlus Fund Lawsuits”

  1. William Says:
    April 2nd, 2008 at 11:05 pm

    Hello,

    I have lost approx. $5000. in this fund before i sold. I definetly feel I have been mislead. I repeatedly contacted Schwab about the quality and
    content of the portfolio and was told everthing was as descibed in the prospectus.

  2. william Says:
    April 3rd, 2008 at 10:35 am

    I purchased just over $100,000 of the above fund in May of 2003, prior to when you indicate the fund was first offered. I was told it was a safe investment similar to a money market from which the funds where taken from. This is from my wife’s IRA.

  3. Schwab YieldPlus Select Losses Recoverable - Charles Schwab Lawsuits | Legal News & Updates Blog - Saiontz, Kirk & Miles Says:
    April 10th, 2008 at 8:38 am

    [...] financial fraud lawyers at Saiontz, Kirk & Miles, P.A. are reviewing potential Schwab Yield Plus Select lawsuits as a result of omissions and misleading statements made by the brokerage, which prevented investors [...]

  4. Dennis Says:
    April 14th, 2008 at 10:24 am

    I joined the Schwab Private Client in late 2004. Shortly after Schwab converted my Value Advantage funds to Yield Plus. After loosing 20% they converted them back to Value Advantage!!

    My loss was probably around $40,000. Is a personal lawsuit better than the class action? What would a suite cost me?

    Thanks,
    Dennis

  5. Austin Kirk Says:
    April 16th, 2008 at 11:01 am

    For any investment losses in excess of $10,000, an individual Charles Schwab lawsuit should be considered. Our lawyers are providing free consultations and claim evaluations to help investors determine if they may be entitled to recover investment losses. If a case is pursued, there are no fees or expenses charged unless a recovery is obtained.

    To review a potential claim, call (800) 522-0102 or request a claim evaluation on-line.

  6. Schwab YieldPlus Problems - Other bond funds may be impacted | Legal News & Updates Blog - Saiontz, Kirk & Miles Says:
    April 21st, 2008 at 1:17 pm

    [...] lawyers at Saiontz, Kirk & Miles, P.A. represent investors who are pursuing Schwab YieldPlus lawsuits and Morgan Keegan lawsuits to recover losses suffered as a result of the fund managers’ [...]

  7. Charles Schwab Yield Plus Settlement offer - Financial Fraud Lawsuits | Legal News & Updates Blog - Saiontz, Kirk & Miles Says:
    May 2nd, 2008 at 11:46 am

    [...] is reporting that Charles Schwab is attempting to offer only pennies on the dollar to settle Schwab YieldPlus lawsuits being pursued by investors who lost money as a result of their investment in the bond fund. The [...]

  8. curt Says:
    May 21st, 2008 at 7:59 am

    Lost $30,000 in Schwab Yeild Plus. Was told by Schwab Broker in the Middle of August 2007 that this fund had no sub prime risk. If I had known, I would have changed funds.

  9. pat Says:
    June 5th, 2008 at 7:34 pm

    Lost much more than the above resonses. Felt this was a money market equivalent safe fund.

  10. victoria Says:
    June 19th, 2008 at 11:35 am

    I lost over $100,000.00 in the Schwab Yield Plus Fund. I was told that although my return would be low, my money was safe while we continued to diversify my portfolio. I was lead to believe I would not lose any of the principle. At one time over 50% of my total retirement portfolio was in this fund (recommended by Charles Schwab). My husband and I worked for over 35 years to build our retirement portfolio, and to be mislead by Charles Schwab investors like this is total fraud. Why would anyone trust Charles Schwab as their financial institution after this misleading and devastating advice? Why has the public not heard about this through the national news? I am retired and I feel as though people who are looking for an investment company should know about this situation and the extent of loss incurred by Schwab’s misrepresentation. I am sure many people would not trust Charles Schwab with their hard earned money. I talked to “Chuck” and he lied!!!!!!!!!!

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