WellCare (WCG) Securities Fraud Suits Begin After Raid and SEC Probe

WellCare Healthplans Inc. shares closed Friday ,October 26, 2007, at $31.36, down nearly 73%, since Wednesday when trading was halted on news that state and federal law-enforcement agents (the FBI) armed with a federal search warrant raided WellCare's headquarters in Tampa, Fla. The Wall Street Journal on Friday reported huge insider trading, the hallmark of securities fraud:

Since July, Chief Executive Todd S. Farha has sold $8.8 million of shares, while General Counsel Thaddeus Bereday has sold $4.2 million, according to Thomson Financial. Chief Financial Officer Paul Behrens has sold $2.1 million of stock. Regina Herzlinger, a director of the Tampa, Fla., company, sold $2.3 million worth in August. ....Andrew Agwunobi, who now heads Florida's Medicaid agency, served on WellCare's board from June to December 2006 and sold $1 million of shares in December, according to a Securities and Exchange Commission filing....All told, company employees and directors have sold about $47.6 million of stock this year, up from $34.6 million last year, as the company's shares have outperformed the Standard & Poor's 500-stock index by 428% since WellCare went public in mid-2004....

On Friday the SEC and the Conneticut Attorney General joined the probes. Also on Friday, the  law firm Kahn Gauthier Swick, LLC ("KGS") filed a class action lawsuit against WellCare in the United States District Court for the Middle District of Florida, Tampa Division, Case No. 8:07 CV 1940-T24, on behalf of shareholders who purchased the common stock of the Company between May 8, 2006 and October 24, 2007, inclusive (the "Class Period").

If an investor wishes to serve as the lead plaintiff in this class action lawsuit, the investor must move the Court no later than December 26, 2007.If you have further information concerning these facts or are a shareholder and want to be kept apprised of the investigation or of possible legal action, you can e-mail the me at info@hbsslaw.com or call 206-623-7292 or go to http://www.hbsslaw.com/wcg.htm.