Amada Co. Suing Republic New York
NEW YORK (AP) _ Amada Co., the largest manufacturer and distributor of metalworking equipment in Japan, filed a lawsuit Monday against Republic New York Corp.’s securites unit, claiming the bank aided and abetted Martin A. Armstrong in a $1 billion securities fraud.
Amada claims it lost $123 million investing with Armstrong, a New Jersey market advisor and head of Princeton Economics International Ltd. and Cresvale International. Armstrong owes money to between 80 and 100 Japanese corporate investors, but Amada is thought to be the first to file a lawsuit.
Amada’s money was held in accounts at Republic New York Securities Corp., and Republic executives provided letters to Amada that misstated how their money was invested and how much money was in their accounts, according to the complaint.
A spokeswoman for Republic said attorneys for the bank had not seen the lawsuit and could not comment.
Two former Republic executives, William H. Rogers and James E. Sweeney, also were named in the complaint, which was filed in U.S. District Court, Southern District of New York. They could not immediately be reached for comment.
Armstrong was arrested in September and charged with securities fraud. He has denied any wrongdoing and is free on $5 million bail.
Amada did not sue Armstrong, Princeton Economics or Cresvale.
Steven Schindler, Amada’s attorney, would not say why Amada is not suing Armstrong or his companies.
``When it comes to strategy... that’s something I’m not going to comment on,″ he said.
The lawsuit comes a day before shareholders in Republic New York are scheduled to vote on the bank’s acquisition by HSBC Holdings PLC, a London-based bank. The vote had been postponed twice while the bank completed an internal review of its involvement in the Japanese securities fraud.
Republic shareholders are expected to approve the acquisition, which still must pass muster with state and federal bank regulators.