Kaskela Law LLC announced today, Thursday, that it has initiated an investigation into Discover Financial Services (NYSE: NYSE:DFS) on behalf of the company's long-term investors. The probe seeks to determine if the members of Discover Financial's board of directors violated securities laws or breached their fiduciary duties.
The inquiry follows a series of events starting on July 19, 2023, when Discover Financial disclosed that it had misclassified certain credit card accounts into its highest pricing tier since 2007. This error led to merchants being overcharged for accepting the cards for payment. The company is currently discussing the matter with regulators and has warned of potential future regulatory actions. This disclosure led to a sharp fall in the company's stock, which declined $19.40 per share, or 16%, closing at $102.83 per share on July 20, 2023.
In addition to the misclassification issue, Discover Financial also revealed that it received a proposed consent order from the Federal Deposit Insurance Corporation (FDIC) related to a consumer compliance matter separate from the misclassification issue.
On August 14, 2023, further turmoil hit the company when Roger Hochschild announced his resignation as President and CEO and his departure from the board of directors. Following this news, shares of Discover Financial fell an additional $9.69 per share, or 9.5%, to close at $92.96 per share on August 15, 2023.
As of today, Discover Financial Services' stock trades at $90.05.
Long-term investors in Discover Financial are being encouraged by Kaskela Law LLC to contact them for additional information about this investigation and their legal rights and options. Kaskela Law specializes in representing investors in securities fraud, corporate governance, and merger & acquisition litigation.
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