Colonial Execs, Investors Settle Fraud Suit For $10.5M

Law360, New York (August 12, 2011, 9:41 PM EDT) -- Colonial BancGroup Inc. shareholders reached a $10.5 million settlement in a putative class action Friday in Alabama to resolve claims the company's executives engineered a multipart fraud that gutted investors and drove the company into bankruptcy.

In a motion requesting preliminary approval of the settlement, the shareholders called the agreement an "outstanding result" for the class, which was battling a company with limited resources.

"Although lead plaintiffs and their counsel believe their case to be strong, their ability to construct a case would be hampered by...
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