Morgan Keegan’s hometown newspaper, the Memphis Commercial-Appeal, recently published an article detailing the factors behind the collapse of Morgan Keegan’s RMK family of bond mutual funds.  Among the factors pointed out by the article are:

• Lack of regulatory oversight
• Lack of supervision by Morgan Keegan over Jim Kelsoe, the funds’ manager
• Kelsoe’s “bets” in the inferior tranches of Collateralized Debt Obligations and Collateralized Mortgage Obligations; bets which lost heavily during the subprime mortgage collapse.

As noted by the article, most RMK investors had no idea they were investing in products which made such risky bets in structured finance, particularly subprime mortgages.  This was even acknowledged by Gary Stringer, investment director of Morgan Keegan’s Wealth Management division, who stated in a May 2007 e-mail:  “Mr. & Mrs. Jones don’t expect that kind of risk from their bond fund. . . . I’d bet that most of the people who hold that fund have no idea what’s it’s actually invested in. I’m just as sure that most of our [Financial Advisors] have no idea what’s in that fund either.”

To read the entire article please click:  http://www.commercialappeal.com/news/2011/dec/18/morgan-keegan-what-went-wrong-genius-at-work/

If you or someone you know lost money in the RMK bond funds, please contact the attorneys at The Frankowski Firm at 888-741-7503 to discuss your potential legal remedies.