Shares of Imperial Holdings, Inc. (NYSE:IFT) crashed today to close at $2.19 per share, down 65%. Yesterday, the company’s Boca Raton offices subsidiary Imperial Finance were raided by federal authorities. Also, it is being reported that two of the company’s underwriters from its IPO earlier this years suspended or downgraded their ratings.
Imperial Holdings, Inc. (NYSE: IFT), the publicly-traded parent of Imperial Finance & Trading, issued a press release after the stock market closed announcing that the Company understood that the Company, its chairman and CEO, and its president and COO were “under investigation in the District of New Hampshire with respect to its life finance business.” The Company stated that it was “not aware of any wrongdoing” and noted that it retained attorneys at an outside law to help the company in responding to the investigation. The Company is headquartered in the Boca Raton, Florida.
According to news reports, trading of Imperial Holdings, Inc. (NYSE:IFT) shares on the New York Stock Exchange were halted today after federal authorities raided the company’s subsidiary Imperial Finance & Trading at its Boca Raton, Florida offices.
Imperial Holdings, Inc. is a Florida corporation, and states that it is “a specialty finance company with a focus on providing premium financing for individual life insurance policies and purchasing life settlements and structured settlements.” According to its filings with the Securities & Exchange Commission, the “Company manages these operations through two business segments: life finance (formerly referred to as premium finance) and structured settlements. In the life finance business, the Company earns revenue/income from interest charged on loans, loan origination fees, agency fees from referring agents and unrealized changes in the fair value of life settlements the Company acquires. In the structured settlement business, the Company purchases structured settlements at a discounted rate and sells such assets to third parties”
On February 11, 2011, the Company completed the sale of 16,666,667 shares of common stock at an initial public offering price of $10.75 per share. On February 15, 2011, the Company sold an additional 935,947 shares of common stock in connection with the over-allotment option the Company granted to its underwriters in the Company’s initial public offering.
Shares of IFT securities are down substantially since its IPO. Shares of IFT last traded at $6.30 on September 27, 2011, before trading was halted.