The BISYS Group, Inc. (NYSE:BSG), a New Jersey-based provider of outsourcing solutions for financial services providers, has announced the preliminary settlement of the two related securities class actions pending against the company in the S.D.N.Y. The cases involve alleged fraud in connection with a series of financial restatements made by the company over the past few years. The settlement is for $66.5 million, of which no more than $25 million will be covered by insurance.
For those readers interested in the collective scienter theory (see this post), the denial of the motion to dismiss in one of the BISYS cases is an example of the application of that theory. The citation for the opinion is In re BISYS Sec. Lit., 397 F.Supp.2d 430 (S.D.N.Y. 2005).