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April 15 is just around the corner and investors, if they
haven’t already done so, are starting to work on their
taxes. As they get their papers together, they’re trying
to decide whether they should do their taxes themselves
or get assistance. If they are considering assistance, then
one of the names that they think of is H&R Block (HRB).
That Company has been in the news lately, but not for
reasons it likes.
Last week, Kansas City-based H&R Block Inc. stock
plummeted after the Company announced it will restate
earnings for fiscal years 2004 and 2005, as well as the
first two quarters of fiscal 2006, to correct accounting errors.
Ouch!
Okay, you say just another company that has to restate its
earnings due to corporate irregularities. But the shocker
for H&R Block investors is the reason for the restatement.
The restatement will occur mainly because of errors in
calculating its state effective income tax rate. Specifically,
these “tax mistakes” resulted in the Company understating
its state income tax liability by about $32 million as of the
end of April 2005.
That’s right. H&R Block, the Company that many
Americans trust to do their income taxes, made a $32 million
tax mistake. You would think that H& R Block would check
its own taxes very, very carefully.
Of course, the victims of their mistake, as is almost always
the case when corporate restatements occur, are the
Company’s shareholders. It appears that investors that
purchased H&R Block between August 26, 2003 and
February 22, 2006 are affected.
We are currently investigating this matter and if you are
an affected H&R Block investor or an affected investor in
any of the companies listed below under investigation,
you may wish to contact us at info@securitiessleuth.com
or 877.511.4717.
Cases Under Investigation
ProQuest Company (PQE) On February 9, 2006, the
Company announced that it had discovered material
irregularities in its accounting and would have to restate
certain of its previously issued financial statements. Its
stock plummeted on this news. Investors who purchased
ProQuest between January 9, 2003 and February 8, 2006
are affected.
Dot Hill Systems Corp. (HILL) On February 3, 2005, the
Company announced its preliminary Fourth Quarter financial
results and that it would be restating its 2004 unaudited
financial results due to a data entry error that the Company
attributed to “the material weaknesses in its internal control
over its financial closing process.” Investors who purchased
HILL between April 23, 2003 and February 3, 2005 are affected.
Chicago Bridge &Iron Company (CBI) On February 3, 2006,
CBI fired its Chairman, President and Chief Executive Officer
and disclosed that its expects to issue revised guidance
regarding its results of operations for the year ended
December 31, 2005 and that all previous earnings guidance
issued by the Company for 2005 is no longer operative.
Investors who purchased CB&I between March 9, 2005 and
February 3, 2006 are affected.
Applica Inc. (APN) On April 20, 2005, the Company revealed
that its business was suffering and that it was marking down
inventory and experiencing increased warranty expenses.
Investors who purchased Applica between November 4, 2004
and April 28, 2005 are affected.
Amkor (AMKR) The Company’s stock plunged 25% after its
was disclosed that its gross margins had declined materially
and that its “product mix” had turned unfavorable. Investors
who purchased Amkor between October 27, 2003 and
July 1, 2004, are affected.
Take Two Interactive Software (TTWO) Since January 18, 2006,
Take Two investors have been stung by a series of negative
announcements. On January 25, 2006, the Company’s audit
committee chairwoman resigned and stated that management
failed to keep the board informed of key issues. Among other
things, the Company is currently being investigated by the FTC
for possibly engaging in unfair or deceptive practice in the
sale of its Grand Theft Auto video game. Investors who
purchased between October 25, 2004 and January 27, 2006
are affected.
Now with respect to settled cases. If you are an affected
investor – you purchased any of these stocks during the
relevant class period, you may wish to contact the claims
administrator to obtain additional information. Remember,
if you don’t submit your claim form, you won’t receive your
proportionate share of recovery.
Eaton Vance Corp. (EV)
Class Period: May 25, 1998 to March 15, 1999, and
March 13, 2000 to March 2, 2001
Claim Deadline: May 5, 31, 2006
Claims Administrator: Complete Claims
Eagle Building Technologies (EGBT)
Class Period: November 21, 2000 to February 14, 2002
Claims Deadline: May 1, 2006
Claims Administrator: Berdon
eFunds Corporation (EFD)
Class Period: July 21, 20000 to October 24, 2002
Claims Deadline: May 5, 2006
Claims Administrator: Gilardi
Uniroyal Technology Corp.(UTCIQ)
Class Period: February 8, 2000 to May 13, 2002
Claims Deadline: June 28, 2006
Claims Administrator: Garden City
Solectron Corp. (SLR)
Class Period: June 18, 2001 to September 26, 2002
Claims Deadline: March 28, 2006
Claims Administrator: Garden City
Again, if you are affected by a settled case, then you should
contact the claims administrator (rather than us). However,
if you are an affected investor in any of the companies under
investigation, you many wish to contact us so that you
can consider your options.
Likewise, if you happen to be aware of corporate restatements
or other financial fraud -- especially if you're a victim --
you're encouraged to contribute to the Sleuth by giving your
own tip-offs at www.securitiessleuth.com or by e-mailing
info@securitiessleuth.com. You can also call Mark McNair
at 877-511-4717. If you have a friend or colleague you
think would benefit from The Sleuth, please pass along
this issue and ask them to sign up at
www.cartville.com/app/join.asp?MerchantID=47994.
Warmest regards,
Mark McNair
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