Franklin Resources, Inc. Under Investigation for Alleged Securities Violations

NEW YORK, Nov. 10, 2024 (GLOBE NEWSWIRE) -- The prominent securities law firm Bleichmar Fonti & Auld LLP has announced an investigation into Franklin Resources, Inc. (NYSE: BEN) for potential breaches of federal securities laws.

Investors in Franklin Resources are urged to seek more information by visiting this link.

What Led to the Drop in Franklin Resources's Stock?

Franklin Resources, known for its asset management operations, manages approximately $1.7 trillion through its flagship brand, Franklin Templeton. One of its main divisions is Western Asset Management (WAM), which specializes in fixed income management.

On July 26, 2024, the company disclosed that it had initiated an internal investigation regarding past allocations of treasury derivatives in some WAM accounts. This announcement was linked to ongoing inquiries by the SEC and the U.S. Department of Justice. The news triggered a 2.4% decrease in the company’s stock price, dropping from $23.64 on July 25 to $23.08 on July 26.

Subsequently, on August 21, 2024, Franklin Resources revealed that WAM's co-Chief Investment Officer, Ken Leech, had been put on leave immediately following the receipt of a Wells Notice from the SEC. This prompted the firm to shut down its Macro Opportunities strategy, which had around $2 billion in assets under management as of July 31, 2024. Federal investigations reportedly examine whether Leech had favored certain accounts in trade allocations, commonly known as "cherry-picking." This revelation led to a substantial 13% drop in stock prices from $22.62 on August 20 to $19.78 on August 21.

On November 4, 2024, the company reported its preliminary results for the fourth quarter and fiscal year 2024, indicating $31.3 billion in long-term asset outflows for the quarter ending September 30, a staggering 354% increase from the same period last year. Notably, $37 billion of these outflows originated from WAM. The report also highlighted a net loss of $84.7 million compared to a net income of $174 million in the previous quarter. This announcement caused an almost 3% decline in stock price on the same day.

For further details, you can access more information here.

What Are Your Options?

If you are an investor in Franklin Resources, Inc., you may have legal options available. You are encouraged to share your details with the firm for potential representation, which is offered on a contingency fee basis—meaning you do not bear any costs upfront. Shareholders will not be liable for any litigation costs unless court approval for fees is granted.

To submit your information, please visit this link.

Why Choose Bleichmar Fonti & Auld LLP?

Bleichmar Fonti & Auld LLP stands as a leading international law firm that advocates for plaintiffs in securities class actions and shareholder litigation. The firm was recognized as one of the Top 5 plaintiff law firms by ISS SCAS in 2023. Their legal team boasts accolades from various respected platforms, including Law360 and SuperLawyers. The firm is known for its successful recoveries, including over $900 million from Tesla, Inc.'s Board of Directors (pending court approval) and $420 million from Teva Pharmaceutical Industries Ltd.

For more about BFA and their attorneys, please visit this link.

Attorney advertising. Past results do not guarantee future outcomes.

Franklin, Investigation, Securities