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IRVINE, CA-First Alliance Corp. has released details of a settlement between the company, the Federal Trade Commission and various litigants, including a class of borrowers, in a settlement approved by the United States District Court for the Central District.

The agreement also cancels all outstanding shares of the company’s common stock as of today.

The settlement provides that a payment will be made to stockholders who held shares of First Alliance. Payments will consist of $1.50 per share or the shareholder’s purchase basis on the effective date of the settlement, whichever is less, provided that the total paid to all shareholders does not exceed $3.25 million. The company says that if the total amount of such payments exceeds $3.25 million, the payment to each former shareholder will be reduced on an equal proportionate basis until the total payments do not exceed $3.25 million. The settlement fund will be administered by a contractor of the Federal Trade Commission.

Until March 2000, First Alliance Corporation was a sub-prime lender headquartered in Irvine.

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