Maddox Hargett & Caruso, P.C. is investigating the possibility of taking legal action on behalf of investors that lost money in a collateralized debt obligation (“CDO”) called Norma CDO I Ltd.(“Norma”).
Merrill Lynch created Norma to capitalize on the sub-prime market before that market crashed. Norma’s holdings consisted primarily of CDOs and the resulting structured investment products were sold to both retail and institutional investors. Over $1.5 billion of these securities found their way into the portfolios of investors.
As a result of the recent housing market collapse and the ongoing mortgage crisis, the value of Norma has been greatly diminished. This decline in value has led to significant losses for investors.
We are investigating how Merrill Lynch and others marketed Norma, and whether the true risks of Norma were fully disclosed to its investors. Questions have arisen and we are working to determine whether Norma was suitable for the retail and institutional customers that invested in the product.