Law Firm Courts Shareholders Of N.Y. Insurer

By Warren S. Hersch

January 06, 2010 at 07:00 PM

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A law firm is looking into the possibility of helping shareholders of a Northeastern insurer sue the company.

The law offices of Howard G. Smith, Bensalem, Pa., are investigating potential claims against Presidential Life Corp., Nyack, N.Y., (Nasdaq:PLFE) and Presidential Life directors.

The claims stem from Presidential Life's investigation of a 2007 tax return filed by the Kurz Family Foundation Ltd. in connection with a foundation application filed with the New York State Insurance Department. The foundation is seeking department permission to acquire a controlling interest in the insurer. The Kurz Family Foundation is the beneficial owner of about 21% of Presidential Life's outstanding common stock.

Herbert Kurz, a director and stockholder of Presidential Life, is also an officer and director of the foundation, which is a separate entity from Presidential Life.

On Dec. 10, 2009, Presidential Life issued a press release announcing that an examination of the 2007 foundation tax return revealed "issues concerning potential self-dealing by Mr. Kurz and improper use of charitable assets for personal expenses."

Smith declined to comment on the investigation.

A representative for Presidential Life said potential shareholder claims against the insurer in connecting with the Kurz Foundation are without merit.

The company fulfilled its fiduciary duties upon uncovering the 2007 tax return irregularities, the representative said.

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