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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JULY 15, 1999
DOWNEY FINANCIAL CORP.
(Exact name of registrant as specified in its charter)
DELAWARE 33-0633413
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
COMMISSION FILE NUMBER: 1-13578
3501 JAMBOREE ROAD
NEWPORT BEACH, CALIFORNIA 92660
(Address of principal executive offices and zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (949)854-0300
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ITEM 5. OTHER EVENTS.
On June 2, 1999, a complaint was filed in the Superior Court of the State
of California in and for the County of Los Angeles against sixteen large
banks located in California, including Downey Savings and Loan Association
F.A. (the "Bank"). The complaint alleges that the defendant banks
fraudulently obtained monies from homeowners/mortgage borrowers by charging
them deed of trust reconveyance fees but failing to actually reconvey the
related deed of trust upon refinancing or repayment of the loan. The
complaint further alleges that the defendant banks failed to refund the
reconveyance fee to the homeowner/mortgage borrower and failed to escheat
the money to the State of California, as required by California law.
Plaintiff seeks monetary damages against the defendants in excess of
$100,000,000.
It is and has been the Bank's practice to effect a reconveyance of the deed
of trust when a homeowner/mortgage borrower refinances or repays the loan.
Therefore, the material factual allegations of the complaint have no
foundation in fact with respect to the Bank. Management believes that the
resolution of this matter will not have a material effect on the Bank's or
the Company's financial position or results of operations.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
Not applicable.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DOWNEY FINANCIAL CORP.
Date: July 15, 1999 By /s/ Thomas E. Prince
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Tomas E. Prince
Executive Vice President and
Chief Financial Officer
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