Court acquits Dexia of misleading investors
7 July 2004 , AMSTERDAM − In the largest Dutch collective legal battle ever, the Amsterdam Court ruled on Wednesday that financial company Dexia did not mislead investors by the sale of a so-called share lease scheme.
7 July 2004
AMSTERDAM − In the largest Dutch collective legal battle ever, the Amsterdam Court ruled on Wednesday that financial company Dexia did not mislead investors by the sale of a so-called share lease scheme.
Investors who lost money in the scheme lodged legal action against Dexia in 2002, but the court said the advertisement used by the company was clear enough in indicating that there were risks attached to the scheme, newspaper De Telegraaf reported.
The court handed down its ruling on a December 2000 advertisement for a scheme that suggested to investors they could triple their investment amount, attracting a large number of willing participants.
About 80 percent of investors involved in the massive legal battle invested money in this scheme, newspaper De Volkskrant reported.
Investors were able to use borrowed money from Dexia to invest in the stock market, but the share price troubles in recent years meant that many shares failed to yield sufficient returns, leaving many investors with debts.
In reaction to Wednesday's ruling, the Dutch consumer watchdog Consumentenbond said legislation should be sharpened so that it is clearer what can and can't be said in advertisements for share lease products.
The Stichting Leaseverlies (Lease Loss Foundation) is demanding that 92,000 investors be repaid by Dexia. But in the largest collective legal battle in Dutch history, the court's interim ruling rejected most of the foundation's claims.
The court said it needed to study Dexia products individually before giving a ruling, but gave the green light for the Consumentenbond and the foundation to continue legal action.
It said any possible compensation will need to be assessed individually, but the foundation said the ruling gave little hope for investors.
[Copyright Expatica News 2004]
Subject: Dutch news