Thrift Hit With Shareholder Suit

The Schiffrin & Barroway law firm, Bala Cynwyd, Pa., has announced the filing of a shareholder lawsuit on behalf of shareholders who bought shares of New York Community Bancorp between June 27, 2003, and May 9, 2004.The firm is alleging that the Westbury, N.Y.-based thrift, as well as Joseph R. Ficalora, its president and chief executive officer, and Michael P. Puorro, its chief financial officer, have violated aspects of the Securities Exchange Act by failing to disclose certain adverse facts and misrepresenting certain facts. The suit alleges that the defendants manipulated the company's financial results through "leveraged growth funded by short term funding" in order to appear more attractive for potential merger deals. It also alleges that the company's projections about growth and interest rate sensitivity did not have any reasonable basis when made, and that its financial results were "materially inflated at all relevant times." A spokesman for Abernathy McGregor, NYCB's public relations representative, told MortgageWire that the allegations "are without merit, and the company will defend itself vigorously in court." Another law firm, Schatz & Nobel, has also initiated a similar shareholder lawsuit against NYCB, the spokesman said.