Zamansky LLC announces that it is investigating Virtus Investments Partners Inc. (“Virtus”) (NASDAQ:VRTS) for potential securities fraud violations. Virtus, a financial services company, offers a wide range of mutual funds, exchange-traded funds (“ETFs”) and other products. Virtus is best known for its “AlphaSector Rotation” and “Premium AlphaSector” Funds launched in 2009, which purport to use proprietary quantitative models to allocate and re-allocate among ETFs across market sectors.
The investigation concerns Virtus’s “AlphaSector” funds, which drove the growth of Virtus’s stock price to over $220 per share. On September 3, 2014, the Wall Street Journal reported that F-Squared Investments Inc. (“F-Squared”), a co-investment adviser of the AlphaSector Funds, was under investigation by the United States Securities & Exchange Commission (“SEC”) for alleged falsifications concerning its performance and track record in its sales and marketing materials.
As a result of the news of the SEC investigation, Virtus’s stock price fell by $37 per share, or 16%, from $223 to $186 per share. The AlphaSector funds have also experienced substantial outflows of investor funds.
On December 22, 2014, the SEC settled charges against F-Squared for fraud and various violations of the Investment Advisors Act of 1940. F-Squared agreed to cease and desist its prior misconduct, the appointment of a compliance consultant and fines and penalties of $35 million.
According to stock fraud attorney Jake Zamansky, the SEC investigation against F-Squared raises questions about the knowledge of Virtus’s management. If Virtus’s management knew that its sales and growth of AlphaSector funds were based on false marketing statements, it should have disclosed what it knew to investors, Zamansky states.
What Investors Can Do
If you purchased Virtus’s common stock between June 1, 2010 and September 5, 2014, please contact our firm for an evaluation of your rights. You can contact Jake Zamansky by telephone at (212) 742-1414 or by email at jake@zamansky.com.
About Zamansky LLC
Zamansky LLC is a leading law firm specializing in securities fraud, mutual and hedge fund and investor class actions. We are investment fraud attorneys who represent both individual and institutional investors. Our practice is nationally recognized for our ability to aggressively prosecute cases and recover investment losses.
To learn more about Zamansky LLC, please visit our website, http://www.zamansky.com.
Contacts:
Jake Zamansky, 212-742-1414
jake(at)zamansky(dot)com
