Penn Treaty American Corporation Sued for Securities Fraud, Berman DeValerio & Pease Says

Apr 18, 2001, 01:00 ET from Berman DeValerio & Pease LLP

    PHILADELPHIA, April 17 /PRNewswire/ -- A shareholder sued Penn Treaty
 American Corporation (NYSE:   PTA) today, accusing the company and two top
 officers of illegally misleading investors, the law firm of Berman DeValerio &
 Pease LLP said.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010405/BDPLOGO )
     The class action, captioned Sullivan v. Penn Treaty American Corp., seeks
 damages under federal securities laws for anyone who bought Penn Treaty stock
 between November 7, 2000 and March 29, 2001 (the "Class Period"). Berman
 DeValerio & Pease filed the lawsuit in U.S. District Court for the Eastern
 District of Pennsylvania.
     Berman DeValerio & Pease has represented defrauded investors in class
 actions for nearly two decades. To review the complaint and learn more about
 becoming a lead plaintiff, visit our Website at www.bermanesq.com.
     The complaint charges Penn Treaty, which underwrites and sells insurance
 products through its subsidiaries, with defrauding investors by issuing false
 and misleading statements about the company's financial health.
     According to the lawsuit, the defendants reported during the class period
 that Penn Treaty was experiencing a tremendous growth in sales. Furthermore,
 they repeatedly said that the growth was not jeopardizing the company's
 health, and that it had adequate reserve for the increased level of business.
     In fact, the company continued selling policies during its fourth quarter
 of 2000 despite an ability to maintain adequate reserve levels, and despite
 the fact that the company's growth put its solvency at risk. In effect, Penn
 Treaty sold itself out of existence. Premiums grew by 22% during the fourth
 quarter of 2000. But instead of the $40 million in reserves required by
 regulators, the company had just $17.2 million in capital by the end of the
 year.
     On March 30, 2001, Penn Treaty issued a news release saying that, among
 other things, its reserves had sunk so far below the statutory minimum that it
 faced possible liquidation and that its independent accountants were
 questioning the company's ability to remain a viable entity.  After the
 announcement, Penn Treaty stock fell from a closing price of $17.46 on March
 29, 2001 to $10.17 the next day - a 42% decline. Further revelations about the
 company's inadequate reserves and financial problems drove down the stock
 price to nearly $3 a share by April 2, 2001.
     If you purchased Penn Treaty common stock during the period November 7,
 2000 through March 29, 2001, you may wish to contact the following attorneys
 at Berman DeValerio & Pease to discuss your rights and interests:
 
     Alicia Duff, Esq.
     Michael G. Lange, Esq.
     Berman DeValerio & Pease
     One Liberty Square
     Boston, MA 02109
     bdplaw@bermanesq.com
     (800) 516-9926
 
     If you wish to apply to be lead plaintiff in this action, a motion must be
 filed on your behalf with the court no later than June 18, 2001.  You may
 contact the attorneys at Berman DeValerio & Pease to discuss your rights
 regarding the appointment of lead plaintiff and your interest in the class
 action. To be a member of the class, however, you need not take any action at
 this time and you may retain counsel of your own choice.  If you decide to
 seek appointment as lead plaintiff, you may also retain counsel of your
 choice.
     With offices in Boston and San Francisco, Berman DeValerio & Pease LLP has
 prosecuted shareholder class actions since 1982, recovering more than $1
 billion for investors. The firm has acted as lead counsel in numerous lawsuits
 involving violations of federal securities laws. It has successfully litigated
 these actions, and has been singled out for its excellence by many courts.
 The firm prides itself on its responsiveness to shareholders and their needs
 in each case.
 
 

SOURCE Berman DeValerio & Pease LLP
    PHILADELPHIA, April 17 /PRNewswire/ -- A shareholder sued Penn Treaty
 American Corporation (NYSE:   PTA) today, accusing the company and two top
 officers of illegally misleading investors, the law firm of Berman DeValerio &
 Pease LLP said.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010405/BDPLOGO )
     The class action, captioned Sullivan v. Penn Treaty American Corp., seeks
 damages under federal securities laws for anyone who bought Penn Treaty stock
 between November 7, 2000 and March 29, 2001 (the "Class Period"). Berman
 DeValerio & Pease filed the lawsuit in U.S. District Court for the Eastern
 District of Pennsylvania.
     Berman DeValerio & Pease has represented defrauded investors in class
 actions for nearly two decades. To review the complaint and learn more about
 becoming a lead plaintiff, visit our Website at www.bermanesq.com.
     The complaint charges Penn Treaty, which underwrites and sells insurance
 products through its subsidiaries, with defrauding investors by issuing false
 and misleading statements about the company's financial health.
     According to the lawsuit, the defendants reported during the class period
 that Penn Treaty was experiencing a tremendous growth in sales. Furthermore,
 they repeatedly said that the growth was not jeopardizing the company's
 health, and that it had adequate reserve for the increased level of business.
     In fact, the company continued selling policies during its fourth quarter
 of 2000 despite an ability to maintain adequate reserve levels, and despite
 the fact that the company's growth put its solvency at risk. In effect, Penn
 Treaty sold itself out of existence. Premiums grew by 22% during the fourth
 quarter of 2000. But instead of the $40 million in reserves required by
 regulators, the company had just $17.2 million in capital by the end of the
 year.
     On March 30, 2001, Penn Treaty issued a news release saying that, among
 other things, its reserves had sunk so far below the statutory minimum that it
 faced possible liquidation and that its independent accountants were
 questioning the company's ability to remain a viable entity.  After the
 announcement, Penn Treaty stock fell from a closing price of $17.46 on March
 29, 2001 to $10.17 the next day - a 42% decline. Further revelations about the
 company's inadequate reserves and financial problems drove down the stock
 price to nearly $3 a share by April 2, 2001.
     If you purchased Penn Treaty common stock during the period November 7,
 2000 through March 29, 2001, you may wish to contact the following attorneys
 at Berman DeValerio & Pease to discuss your rights and interests:
 
     Alicia Duff, Esq.
     Michael G. Lange, Esq.
     Berman DeValerio & Pease
     One Liberty Square
     Boston, MA 02109
     bdplaw@bermanesq.com
     (800) 516-9926
 
     If you wish to apply to be lead plaintiff in this action, a motion must be
 filed on your behalf with the court no later than June 18, 2001.  You may
 contact the attorneys at Berman DeValerio & Pease to discuss your rights
 regarding the appointment of lead plaintiff and your interest in the class
 action. To be a member of the class, however, you need not take any action at
 this time and you may retain counsel of your own choice.  If you decide to
 seek appointment as lead plaintiff, you may also retain counsel of your
 choice.
     With offices in Boston and San Francisco, Berman DeValerio & Pease LLP has
 prosecuted shareholder class actions since 1982, recovering more than $1
 billion for investors. The firm has acted as lead counsel in numerous lawsuits
 involving violations of federal securities laws. It has successfully litigated
 these actions, and has been singled out for its excellence by many courts.
 The firm prides itself on its responsiveness to shareholders and their needs
 in each case.
 
 SOURCE  Berman DeValerio & Pease LLP