Boston Business Journal’s Largest FinTech Companies in Massachusetts: Financial Recovery Technologies (#9)

We’re thrilled to be part of Boston Business Journal’s Largest FinTech Companies in Massachusetts list. Click here to view the full list on Boston Business Journal (we have unlocked access to this list for non-subscribers).

Within the FinTech industry, we see numerous growth opportunities. We believe successful innovation comes from applying purpose-built technology to a specific problem or challenge; in our case, the area of shareholder litigation monitoring and claims recovery. Regulatory compliance and enhanced standards for governance and fiduciary responsibility have drastically enhanced the challenges facing both asset owners and asset managers, creating opportunities for FRT to create solutions that help these firms alleviate the pressure and raise their ability to meet increasing standards. FRT’s purpose-built technology and related services enable firms to process more data at a higher scale and speed than ever before and position their governing boards to make informed and responsible decisions with increased efficiency.

In 2018 (year-to-date), Financial Recovery Technologies has grown over 15%. We’re continuing to invest in our people, our services, and our technology to provide best-in-class shareholder class action governance, monitoring and recovery services.

Contact us to learn how FRT’s Shareholder Class Action Services provides purpose-built technology to streamline the shareholder litigation monitoring and claims recovery  process.

Learn More

To learn more about how FRT can help your firm maximize recoveries in shareholder class action settlements, contact us at learnmore@frtservices.com.

About FRT

U.S. CLAIMS  I  GLOBAL GROUP LITIGATION  I  ANTITRUST  I  LITIGATION MONITORING  I  BUYOUTS

Founded in 2008, Financial Recovery Technologies (FRT) is a leading technology-based services firm that helps the investment community identify eligibility, file claims and collect funds made available in securities and other class action settlements. Offering the most comprehensive range of claim filing and monitoring services available, we provide best-in-class eligibility analysis, disbursement auditing and client reporting, and deliver the highest level of accuracy, accountability and transparency available. For more information, go to www.frtservices.com.

This communication and the content found by following any link herein are being provided to you by Financial Recovery Technologies (FRT) for informational purposes only and does not constitute advice. All material presented herein is believed to be reliable but FRT makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Opinions expressed in this communication may change without prior notice. Firms should always seek legal and financial advice specific to their unique situation and objectives.

Leading pension funds agree on importance of securities litigation monitoring

Panel of industry experts review fiduciary duty to actively track global securities litigation for institutional investors

A panel comprised of past and present legal representatives from several leading U.S. pension funds, during a webinar hosted by Financial Recovery Technologies, LLC (FRT), emphasized that institutions have a strong fiduciary duty to actively track securities litigation, in the U.S. and across the globe. The expert panelists shared their funds’ experiences in being active participants in securities litigation. The discussion also addressed how funds should assess damages in order to make informed decisions about becoming active, what funds should consider before becoming active, and what impact being an active participant may have on an institution.

Securities litigation and resulting class actions represent both challenges and potential opportunities for institutional investors. While recovering damages caused by corporate financial malfeasance is beneficial to a fund, becoming actively involved in securities litigation can be a daunting experience.

Litigation monitoring involves tracking newly filed fraud complaints, assessing the potential impact on the fund and its investments, and deciding whether or not to take action. Increasingly, institutions are not only looking at securities litigation in the context of fiduciary duty, but seek a deeper understanding of their own recoverable damages in affected securities, in order to make wiser decisions about if and when to seek lead plaintiff status, or whether to opt out of the class to pursue a private action. Funds that take a proactive role in the litigation process can have a large impact on their assets and the investment community as a whole.

As discussed by the panelists, pension funds have several options for monitoring securities class litigation, including utilizing internal sources, relying on outside counsel who may not have the fund’s best interest in mind, or outsourcing to an impartial third party service.

“Monitoring securities litigation and evaluating whether or not to become an active participant is a standard of fiduciary responsibility for institutional investors,” said Kim Johnson, who served for more than a decade as General Counsel to the Louisiana and Colorado state pension funds. “Today’s discussion really highlighted how the use of unbiased and consistent evaluation can aid in meeting this standard.”

Download a replay of the webinar here. For a copy of FRT’s whitepaper that accompanies the webinar, click here.

About FRT

U.S. CLAIMS  I  GLOBAL GROUP LITIGATION  I  ANTITRUST  I  LITIGATION MONITORING  I  BUYOUTS

Founded in 2008, Financial Recovery Technologies (FRT) is the leading technology-based services firm that helps the investment community identify eligibility, file claims and collect funds made available in securities and other class action settlements. Offering the most comprehensive range of claim filing and monitoring services available, we provide best-in-class eligibility analysis, disbursement auditing and client reporting, and deliver the highest level of accuracy, accountability and transparency available. For more information, go to www.frtservices.com.

This communication and the content found by following any link herein are being provided to you by Financial Recovery Technologies (FRT) for informational purposes only and does not constitute advice. All material presented herein is believed to be reliable but FRT makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Opinions expressed in this communication may change without prior notice. Firms should always seek legal and financial advice specific to their unique situation and objectives.

Pension funds most likely to opt out, particularly in high-settlement cases

While one of the key reasons to utilize a third-party securities class action service provider is to monitor and identify opportunities to recover damages from a class action settlement, opting out is another potential avenue institutional investors can take. Historically funds have avoided opting out to pursue their own, separate lawsuit. New statistics reveal that opting out might be more common than previously thought – particularly for pension funds.

Cornerstone OptOutCornerstone Research compiled a deep analysis of class action opt outs, revealing some interesting findings. Opt outs most commonly occur in large settlement cases; in fact, 53 percent of class actions with settlements in excess of $500 million contain at least one related opt-out case. This is in sharp contrast to the three percent of overall class actions that result in at least one opt out case.

The Cornerstone Research report evaluated 1,272 securities class action settlements that took place between January 1, 1996 and December 31, 2011. Among them, 38 cases had at least one opt-out plaintiff that filed its own actions against the defendant.

What’s interesting are the payouts received by plaintiffs who chose this route in hopes to increase their own recoveries. Of the 21 cases in which settlement details were available and obtained by researchers, plaintiffs pursuing their own cases received an average of 12.5 percent of the value of the class action settlement – with a median of just 3.8 percent.

There were, however, six cases among the 21 in which the settlement amount in an opt-out case exceeded 20 percent of the value of the class action settlement. Seven of the cases had opt-out settlement amounts in excess of $10 million. All seven settlements, however, took place during a three-year period between November 2004 and November 2007.

Based on the limited data available, Cornerstone surmises that it’s possible for opt-out entities to succeed in obtaining a larger settlement than they would have otherwise. But when evaluated against the higher costs and fees opt-out plaintiffs take on, there are also cases in which they fail to recover any net losses.

With such a broad spectrum of results, funds must carefully weigh the risks against potential rewards on a case-by-case basis, evaluating added costs and other factors. Pension funds, at present, are more likely to consider it a risk worth taking. An experienced third-party class action provider is a valuable partner in determining the best course of action to protect your interests.