Missouri
Secretary of State Jason Kander issued a press release Thursday regarding
failed artificial sweetener manufacturer Mamtek. In the release, available here, Kander
announced a cease-and-desist order against Morgan Keegan & Co. Inc., the
underwriter for bonds issued for a Mamtek project to build a sucralose
manufacturing facility in Moberly, Missouri.
This recent
approach by Kander to recoup funds for investors alleges that Morgan Keegan did
not complete adequate due diligence on the project prior to underwriting the
bond issue. “"If Morgan Keegan had
done its due diligence and investigated the feasibility of Mamtek's business
plan we would not be here today," Kander said at a news conference in St.
Louis. "This is unacceptable."
The city of
Moberly issued over $30 million in bonds to fund construction of the
plant. The project was derailed when the
first principal payment on the bond was missed.
Now the incomplete factory serves as a reminder of the 600 jobs that
never materialized, and a loss for investors all of the U.S.
The failed
project made headlines last year when Mamtek CEO Bruce Cole was charged with
securities fraud by the Securities and Exchange Commission (“SEC”). The SEC complaint against Cole may be viewed
by clicking here. These charges are in
addition to the criminal charges Cole faces in Missouri related to Mamtek’s
failed project.
It remains to
be seen if Kander will be able to recoup anything, as investors who lost
millions continue to seek ways to recoup from Morgan Keegan’s alleged lack of
due diligence in this bond issue.
Please
contact Block & Landsman if you invested in Mamtek bonds so we may discuss
potential legal options with you.
