Gerova Financial Group Ltd (GFC)

[AlanC]

Gerova Investors Pursue Alleged Short and Distort Market Manipulation Scheme, Says Gross Law

SAN FRANCISCO, CA--(Marketwire - Dec 22, 2011) - Gross Law filed a lawsuit on behalf of Noble Investment Fund Limited ("Noble") claiming millions of dollars in investment losses in Gerova Financial Group ("Gerova") as a result of a "short and distort," or "reverse pump and dump," scheme that had the purpose and effect of artificially depressing the share price of Gerova.

The complaint alleges the defendants and their co-conspirators amassed huge short positions (including many illegal naked positions) in Gerova's stock in late 2010 and early 2011, immediately before the company was to complete two major mergers. The complaint further alleges the parties launched a coordinated attack on the company's reputation by using the website zerohedge.com and providing information to Forbes.com blogger Neil Weinberg, who published articles based on that information. Ultimately, Gerova lost approximately $800 million in market capital in less than two months and, according to Gross, Noble and other investors suffered massive losses. Noble's shares, in particular, for which it paid $5.75 million as one of the company's original investors, were worth approximately $17 million prior to initiation of the alleged attack; they are now virtually worthless.

"Defendants and their co-conspirators like to portray themselves as on the side of investors," said Stuart G. Gross, managing attorney at Gross Law, "but in reality these people make money by destroying the investments of others." Gross continued, "The decision by Noble to step forward and pursue claims against those who perpetuated this attack upon Gerova and its investors is commendable and it sends a clear message: these schemes constitute securities fraud, and the schemes' victims will not sit back and leave the perpetrators of such schemes in peace."

Among the defendants is Dalrymple Finance.

"The size and timing of the short positions taken against the company, the timing of their settlement, and the timing of the release of false and misleading information concerning the company were all orchestrated too perfectly to be coincidental," said Gross.

As the complaint alleges, the statements made by defendants and their co-conspirators concerning Gerova were demonstrably false and misleading. However, the complaint states defendants and their co-conspirators were savvy users of the financial blogosphere, weaving statements in such a way to quickly lend their false and misleading statements increased reach and creditability. Subsequent effects on Gerova's stock price, combined with the hugely increased short-selling positions by defendants and their co-conspirators, effectively led to the collapse of Gerova's share price. That was followed by the collapse of the planned mergers and, in Noble's case, losses of millions of dollars.

Gross Law is located in San Francisco and serves international and domestic clients in commercial, natural resource, environmental, antitrust and business practices litigation before courts and tribunals throughout the United States.

The lawsuit, known as Noble Investment Fund Limited v Keith Dalrymple, Victoria Dalrymple and Dalrymple Finance, No. CGC-11-516822, was filed in The Superior Court of the State of California, county of San Francisco. Noble is seeking compensatory and punitive damages, restitution, disgorgement, and injunctive relief.

Contact Information
Contact:
Stuart G. Gross
Gross Law
[phone]
Email Contact
Posted by Abuse of Law at Monday, December 26, 2011

[Renee]

GFC Delisted :

http://nasdaqtrader.com/Trader.aspx?id=TradeHalts

[Ondariis]

well the next REDFLAG is on the fund.com side.

this will be the next one to drop....

common cfo, hmmmm

[CMA7]

Will never, ever ignore a red flag again or assume 'innocent until proven guilty' in cases such as these. Sad comment to make.

[Ondariis]

STRING THEM UP AND GUT THEM!

[CMA7]

If this company is clean, this is the best thing that could be happening IMHO. This will give them the time to put the facts before the NYSE and the public, and if the facts exonerate them, the recent shorting and media persecution can no longer affect the SP.

[CMA7]

NYSE Halts Trading in the Securities of Gerova Financial Group Ltd.
2/23/2011 6:37 PM - PR Newswire

HAMILTON, Bermuda, Feb. 23, 2011 /PRNewswire via COMTEX News Network/ --

Gerova Financial Group, Ltd. ("Gerova") (NYSE: GFC), a diversified financial services company, announced that the New York Stock Exchange, after discussions with the Company, elected to halt trading today pending the Company's disclosure of additional information relative to its operations, management restructuring and business plans.

Chief Financial Officer, Michael Hlavsa, stated, "After a discussion with the NYSE, we concur that the best decision was to halt the trading of our securities. The added time will enable the Company to disseminate to the market in an orderly way a comprehensive update on its recent developments and its strategic direction."

[CMA7]

http://www.nyse.com/press/1298460495321.html?sa_campaign=/rss/newsreleases/NYSE.comOtherNewsReleases

[CMA7]

http://www.cnbc.com/id/41691925

We will just have to sit tight. That's all we can do.

CNBC: Excerpt from CNBC article:
"Keith Harris, chief executive of Seymour Pierce, may look to resuscitate Gerova's role as part of a three-way merger if he can resolve some of the issues affecting the re-insurer, the Mail on Sunday said."

Seymour Pierce to end merger talks with Gerova - report
Published: Sunday, 20 Feb 2011 | 11:42 AM ET Text Size

LONDON, Feb 20 (Reuters) - Investment bank Seymour Pierce is expected to end merger talks with Bermudan re-insurer Gerova Financial in the next few days and pursue a merger with Ticonderoga Securities, the Mail on Sunday reported, citing no sources. Reuters reported in December that the London-based stockbroker was being bought by New York-listed Gerova in a reverse takeover deal that would see little-known Gerova taking Seymour Pierce's name. Under that original deal, Gerova also agreed to buy New York-based institutional broker-dealer Ticonderoga Securities, founded by ex-Collins Stewart executives Joel Plasco and Shawn McLoughlin. Speculation has grown that the merger between Seymour Pierce and Gerova could be in doubt as shares in the re-insurer have slumped almost 80 percent so far this year. Gerova said in January it had engaged Kroll, an intelligence and risk analysis firm, to probe possible market manipulation and collusion aimed at driving down its stock price. Since then, Gerova's chief executive, chairman and four board directors have all resigned, and its replacement as chairman withdrew after he and the company were unable to agree terms. Keith Harris, chief executive of Seymour Pierce, may look to resuscitate Gerova's role as part of a three-way merger if he can resolve some of the issues affecting the re-insurer, the Mail on Sunday said. Seymour Pierce could not be reached for comment. (Reporting by Julie Crust; editing by Sophie Walker) Keywords: SEYMOURPIERCE GEROVA/ ([e-mail]; [phone]) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved.

The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.

[up2tee]

well, considering this thing moves on air, that would be a yes big time!

[CMA7]

With these steps, and depending on the findings of Kroll, we could very soon see a significant need on the part of some for short covering, yes?

[CMA7]

So glad to see damage control beginning.
Thanks for posting this, up2tee. Very glad to see it.

[up2tee]

http://www.stockwatch.com/News/Item.aspx?bid=U-prNY46477-U:GFC-20110210&symbol=GFC&news_region=U

changing of the guard!

[sah932]

IEAH...Another Gerova acquisition?


01/25/2011 6:02PM
IEAH investor the focus of lawsuit
By Glenye Cain Oakford

Litigation involving investors in IEAH Stables took a new twist Monday when Jason Galanis, a venture capitalist and consultant employed by a group offering to buy out IEAH and its bloodstock holdings, sued current IEAH shareholder Matthew Szulik.

In a $60 million lawsuit filed last month in North Carolina, Szulik - founder of the RedHat software company - claimed IEAH's major financial backer, James Tagliaferri of the investment advisory firm TAG Virgin Islands, defrauded him by investing in high-risk ventures like IEAH without his knowledge or consent. According to that suit, Tagliaferri used about $20 million of Szulik's money to finance IEAH.

In related court filings, Szulik also alleged that a proposed takeover of IEAH by Gerova Financial Group could constitute "additional fraud" against IEAH's shareholders because of "the illicit character" of past deals involving Gerova officers, employees, or associates, including Galanis. IEAH had scheduled a Jan. 14 shareholder vote on the Gerova deal, but that vote did not take place.

In his own suit filed Monday in a Boston federal court, Galanis alleges Szulik wanted to ruin Gerova's IEAH buyout offer as part of an elaborate tax-evasion scheme.

Galanis's suit alleges that "Szulik immediately determined that the IEAH-Gerova merger would be fatal to Szulik's planned tax-evasion scheme, since Szulik's private IEAH debt and equity securities - which Szulik alleges in the TAG litigation are worthless - would be converted into valuable, publicly traded Gerova stock as a result of the proposed acquisition, and could thereby undermine Szulik's improper tax strategy."

Galanis contends that "in an effort to prevent the proposed IEAH-Gerova merger, Szulik quickly orchestrated a campaign of disinformation" that was "focused heavily on making false, misleading, and disparaging statements regarding Galanis, including referring to Galanis is litigation to which Galanis is not a defendant."

Galanis's complaint contends that Szulik had used similar tactics in another proposed merger involving a Gerova predecessor, Asian Special Situation Acquisition Corp.

Galanis claims that Szulik, through his attorneys, threatened to sue Galanis if he did not attempt to persuade Gerova management to terminate their offer for IEAH.

Part of the alleged tax-evasion scheme, Galanis's suit claims, also involved a 10-percent in investment in IEAH Stable's Kentucky Derby and Preakness winner Big Brown.

According to Galanis's allegations, "Szulik extended a loan to IEAH and received in exchange a 10-percent equity interest in Big Brown, who was an unproven horse with no winning track record at the time it was acquired by the IEAH Group and Szulik for $4 million. . . . [As] a result of Big Brown's subsequent success at prominent races, it eventually became worth an estimated total of $60 million, as valued when the prominent farm Three Chimneys also acquired a 10-percent equity interest."

Big Brown, it should be noted, was a winner when IEAH struck a private deal with Paul Pompa Jr. to buy a majority stake in the colt. IEAH purchased its interest after Big Brown won his debut race by 11 1/4 lengths in maiden company at Saratoga on Sept. 3, 2007. Pompa reportedly had turned down an earlier private offer from Darley, because Sheikh Mohammed al-Maktoum's operation wanted to purchase 100 percent of the Boundary colt.

Galanis's suit alleges that Szulik "filed tax returns with the Internal Revenue Service improperly declaring depreciation deductions of several million dollars based on Big Brown's increased valuation ($60 million), when Szulik should have only taken deductions based on Big Brown's value at the time of his investment ($4 million)."

In his Boston court filing, Galanis also alleges that Szulik's demand that TAG Virgin Islands withdraw his money from certain investments "coerced TAG to remove Szulik from his immature investments by using funds of Galanis or companies owned by Galanis, totaling about $30 million.

IEAH's president, Michael Iavarone, told Daily Racing Form earlier this month that the then-unidentified group proposing to purchase IEAH's assets did not involve Galanis or Gary Hirst, another individual mentioned in Szulik's lawsuit. In his own suit, Galanis described himself as an employee of a Gerova subsidiary, and in paperwork Gerova filed with the Securities and Exchange Commission last June, Galanis is listed as a member of the three-man Gerova Real Estate Committee, and Hirst is identified as president of Gerova Real Estate Group.

In a statement issued through his attorneys at Holland & Knight, Szulik said, "For the past year, I have invested substantial time and resources in uncovering the fraud perpetrated on me and my family by our former investment advisor, TAG Virgin Islands, and its principal, James Tagliaferri, who have a close association with Mr. Galanis, as Galanis's complaint admits. Galanis's frivolous complaint, based entirely on speculation, not facts, is clearly just an effort to divert the attention from the lawsuit we filed in federal court last month, alleging widespread fraud. The purported tax-evasion scheme Galanis and his attorneys alleged against me is utter nonsense. No one would scheme to lose $60 million in order to deduct some losses on his taxes; any rational person would rather earn a profit and keep most of that profit after paying taxes."

Szulik's statement added that "we will take all appropriate action against those who have made false and defamatory accusations against us in a transparent attempt to deflect scrutiny of their actions."


http://www.drf.com/news/ieah-investor-focus-lawsuit

[sah932]

CBS interview


http://www.cbsatlanta.com/news/26642203/detail.html



and response letter from Gerova


http://www.cbsatlanta.com/download/2011/0127/26642238.pdf

[sah932]

Gerova Completes Acquisition of $1.2 Billion Life Insurance Portfolio and Arranges $50 Million Credit Facility

HAMILTON, Bermuda, Jan. 4, 2011 /PRNewswire via COMTEX/ --

Gerova Financial Group, Ltd. ("Gerova") (NYSE: GFC), a diversified financial services company, announced today that it has completed the acquisition of a portfolio of life insurance policies and loans on life insurance policies representing approximately $1.2 billion of in-force life insurance. The portfolio consists of 180 policies issued by highly rated insurance carriers with 96% of the carriers in the Portfolio rated A, A+, or A++.

The portfolio was acquired from HM Ruby Fund L.P., a Los Angeles-based hedge fund, for $105 million, consisting of $11 million in cash and $94 million in Gerova ordinary shares. The share consideration of $28.69 per share was based on the average closing price of Gerova on the New York Stock Exchange for the ten trading days ending December 30, 2010. The 3,276,403 shares to be issued in the transaction represent 10.2% of the issued and outstanding shares after giving effect to the issuance.

Concurrently, Gerova arranged a five-year $50 million line of credit. The proceeds will be used to service the portfolio, and to service future share-based portfolio acquisitions in the life settlements sector.

"This transaction reaffirms a key aspect of our business model, using our publicly listed shares to acquire private equity portfolios on favorable terms," said Keith Harris, incoming Gerova Chairman.

On December 7, 2010 Gerova announced two other all-share transactions, agreeing to acquire institutional investment banks Seymour Pierce Holdings Ltd. and Ticonderoga Securities LLC.

"Today, Gerova acquired over a billion dollars of high quality financial instruments issued by investment grade rated institutions in exchange for Gerova equity, which substantially enhances our company's balance sheet and our earnings potential as we plan for the integration of Seymour Pierce and Ticonderoga," continued Harris.

Wholly-owned subsidiary Gerova Advisors LLC arranged the transaction.

[CansoSpaceMan]

Seymour Pierce in Talks to Merge with Gerova Financial

Financial Times reported that Seymour is in advance talks with US-based Gerova Financial Group (NYSE: GFC: 27.55, 6.05) for a possible merger.

The deal values Seymour Pierce around $63 million and the consideration is expected to be paid in Gerova Shares. The combined entity will be called Seymour Pierce Inc. Gerova Financial remained flat at $21.50 on Monday's close.

[CansoSpaceMan]

(Reuters) - British investment bank Seymour Pierce Ltd is in advanced talks to merge with U.S.-based reinsurer Gerova Financial Group (GFC.N), Financial Times said, citing people familiar with the talks.

The deal, which could be announced this week, would create a New York-listed investment bank and insurer worth $600 million, according to the newspaper.

The deal values Seymour Pierce at about 40 million pounds and is expected to be paid for in Gerova shares, the paper said.

A Seymour Pierce spokesman declined to comment on FT report to Reuters. Gerova Financial could not immediately be reached for comment by Reuters outside regular U.S. business hours.

The combined entity would be called Seymour Pierce Inc, which would be involved in investment banking, asset management and insurance, the FT said.

The FT also said the deal would enable Seymour Pierce to make further acquisitions of London's smaller stockbrokers.

[pm071]

Very eventful day to be watchig GFC

[CansoSpaceMan]

amazing hit $7.40 for a while.

[up2tee]

what a day!

[CansoSpaceMan]

yes its hard to believe

[pm071]

I am very curious how many days it can continue green. WOW impressive

[CansoSpaceMan]

$6.87 at the open, this is too many green days in a row here.

[pm071]

6.68 close?..wow.
Nice find, this looks like the begining of a meteoric rise? WOnder how far it will continue. Shorts begining to cover? Some must be panicing.

[CansoSpaceMan]

amazing it has had so many green days in a row,

[Molybucks]

Yes, climbing every day. However, looking at the 5 day chart it's a very steep vertical accent. Someone in the know has been loading up big time. The volume has picked up nicely as well.

[Krakatoa_Dean]

yeah, nice close



she's been creeping up daily.

[CansoSpaceMan]

now $6.38

[CansoSpaceMan]

$6.20 right now and think up to about $6.50

[Molybucks]

Gerova is really flying.Much much more good things on the way. Shareholders will be well rewarded.

[CansoSpaceMan]

GEROVA Financial Group, Ltd., formerly Asia Special Situation Acquisition Corp., is an international reinsurance company focused on the life and annuity reinsurance markets, in addition to a property and causality business. Through its insurance subsidiaries, the Company underwrites annuity and life insurance risks. The investment portfolio derived from its insurance reserves, or its float, is allocated across traditional fixed income and equity investments, as well as asset classes. It focuses on engaging in active investment strategies, such as directly making secured loans to middle market companies in select industries underserved by banks. In January 2010, it acquired an 81.5% interest in Amalphis, the parent company of Allied Provident.

[CansoSpaceMan]

20,000 shares ran through at the end of the day to close at the HOD $6.09

[CansoSpaceMan]

$6.08 for a while.

[sask911]

green most of the day!, even stevens now. seems to keep creeping up.

[CansoSpaceMan]

yes there day is coming

[sask911]

wonder if they will have to cover due to the new regs on shorting????definately one to keep an eye on!

[CansoSpaceMan]

I will be watching this one everyday.

[CansoSpaceMan]

Amazing what could happen if they cover 600,000 shares.

[CansoSpaceMan]

lots of new investment coming in and good volume.

[CansoSpaceMan]

Link to shorting

http://seekingalpha.com/article/229936-18-underperforming-financial-stocks-being-targeted-by-short-sellers

[CansoSpaceMan]

<<< GEROVA Financial Group Ltd. (GFC): Life Insurance Industry. Market cap of $672.34M. Short ratio has increased from 2.8 to 22.9, with shares shorted increasing from 464,827 to 625,360. The stock has lost -48.83% over the last year.—

[tr8dervic]

GEROVA to List on the New York Stock Exchange

Press Release Source: GEROVA Financial Group, Ltd. On Tuesday September 7, 2010, 11:52 am
HAMILTON, Bermuda, Sept. 7 /PRNewswire/ -- GEROVA Financial Group, Ltd. ("GEROVA" or the "Company") (NYSE Amex: GFC), a specialty reinsurance holding company, announced today that it has received authorization to list its ordinary shares, warrants, and units on the New York Stock Exchange ("NYSE"). GEROVA expects to begin trading on the NYSE on Wednesday, September 8, 2010, under its current symbols "GFC", "GFC.WS" and "GFC.U", respectively.

"Listing on the New York Stock Exchange is a significant milestone for GEROVA and reflects the continued successful development of our innovative business model. We believe the NYSE listing will significantly increase GEROVA's visibility in the global financial markets," said Joseph J. Bianco, CEO of GEROVA. "In addition, this listing will benefit our stockholders through improved trading efficiencies, as the New York Stock Exchange is the world's largest and most liquid equities market. We are excited about the opportunity to elevate our Company's standing within the business and investment communities and look forward to joining other leading companies who are listed on this premier exchange. We thank NYSE Amex for its service and support."

http://finance.yahoo.com/news/GEROVA-to-List-on-the-New-prnews-1631548017.html?x=0&.v=1

[tr8dervic]

GEROVA Shareholders Approve Redomiciliation to Bermuda

Press Release Source: GEROVA Financial Group, Ltd. On Wednesday September 1, 2010, 3:35 pm
HAMILTON, Bermuda, Sept. 1 /PRNewswire-FirstCall/ -- GEROVA Financial Group, Ltd. ("GEROVA") (NYSE Amex: GFC), a specialty reinsurance holding company, announced that shareholders at the extraordinary general meeting (EGM) held on August 30, 2010, approved all of the resolutions considered, including the redomiciliation of the company from the Cayman Islands to Bermuda.

GEROVA also announced that its Bermuda reinsurance subsidiary, GEROVA Reinsurance Ltd. ("GEROVA Re"), has received its Certificate of Registration as a Long-Term Insurer from the Bermuda Monetary Authority.

GEROVA established its group headquarters offices in Cumberland House, in the central business district of Hamilton, Bermuda, in May of this year.

At the EGM, the following resolutions were approved:


•the continuance of GEROVA as an exempted company under the laws of Bermuda and the de-registration of GEROVA as a company under the laws of the Cayman Islands;
•the new organizational documents of GEROVA in Bermuda; and
•the granting to the GEROVA board of directors the express authority to change the name of GEROVA.




"We are excited for our group parent to become a Bermuda company," said Lou Hensley, CEO of GEROVA Re. "We believe that Bermuda is one of the world's leading reinsurance centers, and is an attractive location in which to be based. Bermuda has strong international relationships, a long history of international investment, particularly in the areas of insurance, reinsurance and investment funds, and long-established commercial relationships, trade agreements and tax treaties with the United States and other countries around the world."

About GEROVA Financial Group, Ltd.

GEROVA Financial Group, Ltd. is an international reinsurance holding company, with operating insurance subsidiaries in Bermuda, Barbados, and Ireland. GEROVA underwrites insurance risks that it believes will produce favorable long-term returns on shareholder equity. GEROVA believes it has opportunities to deploy shareholder capital to acquire high quality assets at less than market value and opportunities to gather additional assets by providing reinsurance capacity to primary insurers that are under writing capacity pressure.

Forward Looking Statements

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the Company, its acquired assets and the Company's business after completion of the transactions consummated in January 2010. Forward-looking statements are statements that are not historical facts. Such forward-looking statements, which are based upon the current beliefs and expectations of the management of the Company, are subject to risks and uncertainties, which could cause actual results to differ from the forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth in the Forward-Looking Statements: (i) potential material reductions in the value of a substantial portion of the Company's assets acquired in connection with the business combinations consummated in January 2010; (ii) officers and directors allocating their time to other businesses or potentially having conflicts of interest with the Company's businesses; (iii) success in retaining or recruiting, or changes required in, the Company's officers, key employees or directors; (iv) the potential liquidity and trading of the Company's public securities; (v) the Company's revenues and operating performance; (vi) changes in overall economic conditions; (vii) anticipated business development activities of the Company following consummation of the transactions described above; (viii) risks and costs associated with regulation of corporate governance and disclosure standards (including pursuant to Section 404 of the Sarbanes-Oxley Act of 2002); and (ix) other relevant risks detailed in the Company's filings with the SEC. The information set forth herein should be read in light of such risks. Neither the Company nor any target companies or funds we intend to acquire assumes any obligation to update the information contained in this release.


Contact:

Investor Contact:
Peter Poulos
Senior Vice President
Hill & Knowlton New York
p: [phone]
[e-mail]
Media Contact:
Elizabeth Cheek
Account Supervisor
Hill & Knowlton New York
p: [phone]
[e-mail]