A $100 million dollar class action settlement has just recently been reached against popular OppenheimerFunds, whose trademark touts “The Right Way to Invest”.
Investors who thought their money was being safety held in conservative,
low-risk mutual funds were unpleasantly surprised when in 2008 two of
Oppenheimer’s conservative investments, The Champion Income Fund
and the Core Bond Fund lost 78.5% and 35.8% of their values, respectively.
Shareholders outraged by the gross loss sued the funds in 2009. Plaintiffs’
lawyers alleged that Oppenheimer misrepresented the funds by marketing
and selling them as a “diversified portfolio” that “[did]
not involve undue risk”. In actuality, the funds took gambles on
mortgage backed securities involving a much higher risk than what was
represented, and which “caused the Fund to crash”.
In order “to eliminate the burden, expense, uncertainty and risk
of further litigation,” Oppenheimer officials settled the cases
while continuing to deny any wrongdoing.
A hearing to approve the settlement is currently scheduled for September
30 before U.S. District Judge John L. Kane in Denver.
In order to participate in the class action, affected shareholders are
required to file a Proof of Claim form.
The period in question for the Champion Income Fund is for funds purchased
between January 1, 2006 and December 31, 2008. For information on filing
and downloading a claim form, see
The period in question for the Core Bond Fund is for funds purchased between
April 30, 2007 and December 31, 2008. For information on filing and downloading
a claim form, see
The deadline to submit claims for either fund is October 30, 2011.