Shares of LEND slumped this evening on disclosure in an SEC Form 4 filing that its President and COO Joseph Lyndon dumped shares on March 13th. However, the shares were liquidated, according to a footnote in the filing, under a 2004 loan agreement between Merrill Lynch and Lyndon. Can you say 'margin call'? Talk about terrible timing, considering the bounce back in the shares from where Lyndon was forced to sell on the 13th.
The initial shoot first and ask question later reaction to the Lyndon stock sale news is a stark reminder of just how dicey a game it is to play these subprime stocks. Still, shares of LEND and other subprime stocks were down in afterhours trading, though off the lows, as the reality of execs being margin called on their loan holdings is a reminder of the world in which these companies now operate.