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Yesterday, July 31, was another day of reckoning for the subprime market. The shares of Melville, New York, American Home Mortgage (AHM) plummeted.
Plummeted is probably too mild a description. Last Friday, AHM closed at $10.47. Trading in the stock was halted all day Monday. Trading started yesterday around 2PM. When the trading session was over, AHM closed at a staggering $1.04 per share. AHM shares in one day lost over 90% of their value.
The Company announced that it had lost its financial backers and that it had contacted advisors to help it consider all its options.
Facing the prospect of liquidation, there was a huge rush to sell AHM shares. Many shareholders are wondering why the Company didn't disclose its true financial position earlier.
RTI International Metals, Inc. Under Investigation
On July 25, 2007, before the opening of trading, Ohio-based RTI International Metals, Inc., disclosed that U.S. Customs and Border Protection was investigating claims filed by the Company to obtain reimbursement of duty paid by the Company on certain imports.
The claims were filed by an agent for the Company. The files of the Company's agent were seized by U.S. Immigration and Customs Enforcement officials and the agent is under investigation for filing false claims on behalf of its customers, including RTI. The Company disclosed that its preliminary investigation identified certain claims filed by the agent which may not have complied with U.S. Customs regulation and may not have been entitled to reimbursement of the duty paid on those items.
The Company stated that in the event U.S. Customs determines that its claims are invalid, the impact to net income will be approximately $0.21 per diluted share.
Not surprisingly, the market reacted strongly to this news.
We are investigating both of these companies and if you are an affected shareholder you may wish to contact us at info@securitiessleuth.com or 202 338 1756.
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 http://securitiessleuth.typepad.com or by e-mailing info@securitiessleuth.com.
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
http://www.cartville.com/app/join.asp?MerchantID=47994.
Warmest regards,
Mark McNair
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