INVESTOR ALERT: Edelson Lechtzin LLP Reminds Discover Financial Services (NYSE: DFS) Shareholders to Consider Seeking Counsel before the October 31 Lead Plaintiff Deadline
NEWTOWN, PA, September 8, 2023 — The law firm of Edelson Lechtzin LLP is investigating securities fraud claims on behalf of all purchasers and holders of Discover Financial Services. (NYSE: DFS) common stock between February 21, 2019, and August 14, 2023, both dates inclusive (the “Class Period”).
Investors who purchased DFS common stock may move the U.S. District Court for the Northern District of Illinois to appoint them as lead plaintiff, no later than October 31, 2023. Current holders of DFS stock may pursue corporate governance reforms. Please contact Edelson Lechtzin LLP at 844-696-7492 to discuss your investment losses, or by e-mail at [email protected]. A copy of the Class Action Complaint can be viewed HERE.
Background on Discover Financial Services
DFS is a financial services enterprise headquartered in Riverwoods, Illinois. The company owns Discover Bank, a leading online banking institution that offers a diverse range of financial products and services, including personal loans, home equity loans, student loans, credit cards, checking, and savings accounts.
The Securities Fraud Claims
The Class Action Complaint alleges that during the Class Period, Defendants made materially false and/or misleading statements and/or material omissions regarding the Company’s business, operations, and prospects, including that: (i) DFS maintained deficient risk management and compliance procedures; (ii) as a result of such deficiencies, DFS failed to comply with applicable student loan servicing standards, misclassified certain credit card accounts, overcharged customers, and failed to stem its ballooning credit card delinquency rate; and (iii) the foregoing issues, when they became known, subjected DFS to significant financial exposure, regulatory scrutiny, and reputational harm.
On July 20, 2022, DFS issued a press release concerning its financial results for the second quarter of 2022 and revealed that DFS would suspend its share repurchase program until further notice due to an internal investigation into its student loan servicing practices and compliance matters. On this news, DFS’s stock price fell $9.80 per share, or 8.93%, to close at $100 per share on July 21, 2022.
On July 19, 2023, DFS issued a press release announcing its financial results for the second quarter of 2023 and disclosed that it had misclassified certain credit card products over an approximately 15-year period because of an acknowledged compliance failure. Specifically, DFS said that it had incorrectly classified certain credit card accounts into its highest merchant and merchant acquirer pricing tier, beginning around mid-2007. On this news, DFS’s stock price fell $19.40 per share, or 15.92%, to close at $102.45 per share on July 20, 2023.
On August 14, 2023, DFS issued a press release announcing that its Board of Directors and CEO were stepping down. Also, the same day in an exhibit to an SEC filing, DFS also disclosed that its credit card delinquency rate had increased to 3.00% for the 24-month period ended July 31, 2023, compared to 2.86% for the 24-month period ended June 31, 2023. On this news, DFS’s stock price fell $9.69 per share, or 9.44%, to close at $92.96 per share on August 15, 2023.
For more information, please contact:
Marc H. Edelson, Esq.
Eric Lechtzin, Esq.
EDELSON LECHTZIN LLP
411 S. State Street, Suite N-300
Newtown, PA 18940
Phone: 844-696-7492 or 215-867-2399 ext. 1
Email: [email protected]
Email: [email protected]
Edelson Lechtzin LLP is a national class action law firm with offices in Pennsylvania and California. In addition to cases involving securities and investment fraud, our lawyers focus on class and collective litigation in cases alleging violations of the federal antitrust laws, employee benefit plans under ERISA, wage theft and unpaid overtime, consumer fraud, and data breaches.
This press release may be considered Attorney Advertising in some jurisdictions. No class has been certified in this case, so you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. Your ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.