Shares of Allianz declined 7% on Monday after the German insurer said the U.S. Department of Justice had begun an investigation into losses at its fund management division.
The DOJ investigation follows lawsuits by U.S. investors claiming close to $6 billion in losses from the funds, saying Allianz failed to safeguard their investments during the coronavirus market meltdown, reports Reuters.
Allianz, in disclosing the DOJ investigation, warned of a “relevant risk” that the matter could “materially impact future financial results of Allianz Group,” without providing an estimate.
In March 2020, Allianz was forced to shutter two private hedge funds after severe losses, prompting a wave of litigation from pension funds for truckers, teachers and subway workers, with new suits filed as recently as last month.
