| Company: | Life Partners Holdings Inc |
| Ticker Symbol: | LPHI |
| Class Period: | May-29-07 to Jan-19-11 |
| Date Filed: | Feb-2-11 |
| Lead Plaintiff Deadline: | Apr-3-11 |
| Court: | Western Distric of Texas |
| Allegations: | |
The Complaint charges Life Partners and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Life Partners is a specialty financial services company and the parent company of Life Partners, Inc. ("LPI"). LPI is engaged in the secondary market for life insurance known generally as "life settlements." More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company had routinely used unrealistic life expectancy data that produced inaccurately short life expectancy reports, which were subsequently used to sell life settlement policies to investors; (2) that the Company had purposely concealed the historical rate in which individuals insured by life settlement policies sold by Life Partners had lived past the life expectancy rates previously provided to investors, such that the Company's investors were unable to assess the accuracy or reliability of such data; (3) that by underestimating the life expectancy data to investors, the Company was able to charge substantially larger fees when brokering life settlement policies; (4) that the Company's revenues had been significantly increased through the employment of such business practices; (5) that, as a result, the Company's financial statements were false and misleading at all relevant times; (6) that such business practices, when they were discovered, would initiate an investigation by the federal authorities into the Company's business practices; (7) that the Company lacked adequate internal and financial controls; and (8) that, as a result of the foregoing, the Company's statements about its financial well-being and future business prospects were lacking in any reasonable basis when made.
On December 21, 2010, The Wall Street Journal published an article questioning the Company's life-expectancy estimates and business practices. The article followed a comprehensive investigation into how the Company sold life settlement policies to investors. In particular, the article stated that Life Partners "has made large fees from its life-insurance transactions while often significantly underestimating the life expectancies of people whose policies its customers invest in." Then on January 20, 2011, The Wall Street Journal reported, and the Company subsequently confirmed, that the SEC was investigating Life Partners. The article reported that "As part of its probe, the SEC's enforcement division has been seeking experts to analyze the way Life Partners has estimated the life expectancies of the insured individuals." On this news, shares of the Company's stock declined $2.58 per share, or over 17 percent, to close on January 20, 2011 at $12.46 per share, on unusually heavy trading volume. The Company's stock continued to decline as additional news about Life Partners was subsequently reported.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
