Institutional investors accuse Fortis NV of misrepresenting itself to shareholders and to the general market. Fortis Bank, presently renamed Ageas, was the biggest finance company in the Netherlands and in Belgium before it went under in 2008. It is accused of giving out false information about its financial condition, before it went under.
Investors have filed suit accusing the Belgian-Dutch company of soliciting investments while it knew that it was on the verge of bankruptcy in 2008. The suit accused that from May 2007 to October 2008, Fortis’ faulty evaluations motivated shareholders to invest more in the troubled bank, which was on its way to insolvency. The suit claims that the Fortis board did not publicize timely, accurate information about its damages from US sub-prime mortgages,and at the same time prepared to issue more shares.
Alexander Reus, the foundation director who is filing the suit, said that “This is the appropriate reaction to the fraud perpetrated by Fortis against investors who relied upon the integrity of the market and the compliance of Fortis with its legal obligations,” The Foundation is supported by US securities law firms Barroway Topaz and Grant & Eisenhofer, in addition to over 130 institutional investors from Asia, the Americas and Europe. These investors say that they lost over $2.5billion on their investments in Fortis. Additionally, approximately 2,000 private investors have expressed interest in participating in the suit.