American Mortgage News

SAN FRANCISCO--(BUSINESS WIRE)--Green Welling LLP (“Green Welling”) announced today that it filed a class action suit in the United States District Court for the Central District of California against New Century Financial Corporation (“New Century Financial”) (NYSE:NEW) and certain of its officers and directors, on behalf of all persons or entities who purchased the common stock of New Century Financial during the period between May 4, 2006 and February 7, 2007, inclusive (the “Class Period”).

If you are a shareholder who purchased the common stock of New Century Financial during the Class Period, you have until April 10, 2007 to move the Court to appoint you as lead plaintiff for the Class. Any member of the proposed Class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Lead plaintiffs must meet certain legal requirements. If you wish to discuss this action, review a copy of the Complaint, or have any questions about this matter, you may contact Green Welling at gw@classcounsel.com or toll free at 888-610-4768. For those inquiries made by e-mail, please include a telephone number where you can be reached and your mailing address.

New Century Financial is a real estate investment trust (“REIT”) and one of the nation’s largest mortgage finance companies, providing mortgage products to borrowers nationwide through its operating subsidiaries. The Complaint alleges that during the Class Period, New Century Financial and certain of its officers and directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by issuing materially false and misleading statements and concealing materially adverse facts regarding the Company’s business and financial results, causing the investing public to purchase New Century Financial securities at artificially inflated prices. More specifically, the Complaint alleges that New Century Financial improperly accounted for loan repurchase losses when it knew of, or recklessly disregarded, a surge in borrower payment defaults in 2006. Defendants’ improper accounting of its loan repurchases violated generally accepted accounting principles (“GAAP”) regarding the Company’s allowance for loan repurchase losses. In addition, the Complaint alleges that defendants concealed materially adverse facts from the investing public, including that the Company lacked requisite internal controls, resulting in material misstatements in the Company’s financial statements and press releases.

A February 7, 2007 New Century Financial press release announced that the Company would restate its consolidated financial results for the quarters ended March 31, June 30, and September 20, 2006 to correct errors in its application of GAAP regarding the Company’s allowance for loan repurchase losses. New Century stated that it expected the impact of the restatement to result in a reduction on net earnings for each of the first three quarters of 2006. On this news, shares of New Century Financial fell 35%, to $19.58 on the New York Stock Exchange.

Plaintiff seeks to recover damages on behalf of all persons who purchased New Century Financial common stock during the Class Period. Plaintiff is represented by Green Welling, a San Francisco-based law firm specializing in the prosecution of class actions and other complex litigation nationwide on behalf of a wide range of consumer and investor clients. The firm also has expertise prosecuting securities class actions and class actions involving financial fraud. Please visit www.classcounsel.com for more information about the firm and its recent successes.
Contacts

GREEN WELLING LLP, San Francisco
Robert S. Green, 415-477-6700
Facsimile: 415-477-6710
gw@classcounsel.com
www.classcounsel.com