Details of Stock Research Settlement Outlined
NEW YORK, Feb 1 (Reuters) - A court-appointed administrator has laid out details on how a $432.75 million fund, for settlement of a scandal over Wall Street stock research, will be divided up, the Wall Street Journal reported on Tuesday.
The newspaper said the plan, filed on Monday in the U.S. District Court in Manhattan, follows the 2003 settlement of charges that Wall Street firms issued overly optimistic stock research to win lucrative investment-banking business.
The plan must be approved by U.S. District Court Judge William H. Pauley III, according to the article.
The newspaper said investors are eligible to collect money if they purchased any of more than 50 stocks from the specific brokerage firm linked to that stock.
The purchase must have occurred during specific time periods that vary from stock to stock, and must have ultimately resulted in a net loss to the investor, the article said.
The list of stocks includes many of the dot-com bubble's biggest names, including Level 3 Communications Inc., WorldCom, Global Crossing Ltd. and Ask Jeeves Inc., the newspaper said. Details on the firms and stocks involved were previously determined by the court, according to the article.
The article said that, according to the court filing, investors should receive their checks within nine months after Pauley issues his order following an April 11 hearing.
Anyone who is eligible for the fund should receive a notice by June 3, from the fund administrator, who will rely on information provided by the brokerage firms, the paper said.
Investors who are eligible but do not receive letters must provide proof of purchase and loss by July 8, according to the article.
The firms earlier agreed to provide independent research to their customers and to contribute to a fund for investor education. The settling firms, which include units of Citigroup, Morgan Stanley and UBS AG, did not admit or deny the charges, the newspaper said.