The law firm of Wohl & Fruchter LLP announces that it has commenced an investigation into nondisclosure of certain risks in connection with the sale by Credit Suisse of VelocityShares Daily 2X Long VIS Short-Term ETN’s (“ETN’s”) (NYSE Arca: TVIX). The ETN’s trade on the American Stock Exchange under the symbol “TVIX,” and were intended to replicate, net of expenses, the returns of twice (2x) the daily performance of the S&P 500 VIX Short-Term Futures index. The ETN’s were marketed by Credit Suisse pursuant to certain Pricing Supplements, which purported to describe the risk profile of the ETN’s by noting several variables that might affect the returns on the ETN’s, and presenting certain hypothetical outcomes. However, the presentation of the relevant variables and hypothetical outcomes was misleading insofar as it failed to disclose a critical variable, i.e., the effect of changes in the relationship between short-term measures of volatility and longer-term measures of volatility (sometimes referred to as “term structure” or “yield curve” risk). The hypotheticals also included unlikely and unrepresentative scenarios. Initially, the price of the ETN’s shot up from $22 in July 2011 to $100.90 in October 2011, but then commenced a steady and steep decline. On February 21, 2012, Credit Suisse announced it had “temporarily suspended further issuances of the [VelocityShares Daily] 2x Long VIX Short Term ETNs due to internal limits on the size of the ETNs.” However, this suspension was rescinded in March 2012, causing the price of the ETN’s to collapse further. On March 29, 2012, it was disclosed that the SEC and Massachusetts chief securities regulator were investigating the ETNs. There is currently an action pending against Credit Suisse and other defendants in the United States District Court for the Southern District of New York in connection with the ETN’s on behalf of investors who purchased the ETNs between November 30, 2010 and March 22, 2012, inclusive (the “Class Period”). If you wish to serve as lead plaintiff in the action, you must move the Court no later than July 24, 2012. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation.
Investors with questions about the pending action, or who may wish to discuss their rights with respect to ETN’s they may have purchased and/or sold, are invited to contact our Firm.Additional information is available at http://www.wohlfruchter.com/cases/velocity. About Wohl & Fruchter Wohl & Fruchter LLP represents plaintiffs in litigation arising from fraud and other fiduciary breaches by corporate managers, as well as other complex litigation matters. Please visit our website, www.wohlfruchter.com, to learn more about our Firm, or contact one of our partners. This release may be deemed to constitute attorney advertising.