National City Bank Sued By Local Family

An article in last Wednesday’s Journal Gazette revealed John Shoaff and other family members, are suing National City Bank over it’s decreased stock values and its involvement with subprime lending.  Some quotes from the article:

[…] Fort Wayne City Councilman John Shoaff, Thomas Shoaff and Robert Shoaff – acting on their own and as beneficiaries of a revocable trust bearing each of their names – sued National City Bank on Monday in Allen Superior Court, alleging breach of trust, fraud, constructive fraud and unjust enrichment.

[…] Over the years, the Shoaffs met with bank officials to discuss the trust and its assets. They asked whether the bank was sound, whether the stock was selling at an amount supported by its value, and whether there was anything that could give shareholders concern about the stocks in the future.

But before 2007, National City Bank began to be increasingly involved in subprime lending, such as mortgage loans, construction loans and home-equity loans. And the Shoaffs allege that caused National City Corp.’s stock to begin losing value, according to court documents.

[…] When the Shoaffs inquired about the soundness of the bank and its stock value, they were told everything was fine. Acting on that, the plaintiffs did not sell their shares or the trust’s shares. In July 2007, the stock was selling at $33.05 a share; it is currently valued at less than $2 a share, according to court documents.

The Shoaffs are seeking actual damages from the bank, punitive damages and attorneys’ fees.

[…] The Shoaffs’ lawsuit is not the only such complaint against National City Bank, which was taken over by Pittsburgh-based PNC Financial Services Group Inc. in late October. […]

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