Following a more than 50% stock decline with in just a few weeks an investigation on behalf of investors in shares of Hampton Roads Bankshares, Inc. (NASDAQ: HMPR) over possible Violations of Federal Securities Laws was announced.

The investigation by a law firm focuses on possible shareholder claims based on potential violations of the federal securities laws in connection with certain financial statements. Specifically the investigation concerns whether Hampton Roads Bankshares, Inc or others may have violated securities laws by issuing a series of statements regarding its business, its prospects and its operations that were materially false and misleading at the time they were made.
Hampton Roads Bankshares Net Income fell from a Net Income of $6.81million for 2007 to a substantial Net Loss of $201.14million for 09 and $211.34million in 2010.
On November 26, 2010, Hampton Roads Bankshares, Inc disclosed in a prospectus filed with the U.S. Securities and Exchange Commission (SEC) that on November 22, 2010, the Securities and Exchange Commissions Division of Enforcement notified the Company that the Division is conducting an informal inquiry into the Companys provisions and allowances for loan losses and deferred tax asset valuation allowances contained in its annual and quarterly reports for fiscal years 2008 through 2010.
Then on May 16, 2011, Hampton Roads Bankshares, Inc reported in its 10-Q filed with the SEC for the quarter ending March 31, 2011. Among other things Hampton Roads Bankshares, Inc disclosed that in April 2011 it was notified that the SEC was conducting a formal investigation related to certain accounting matters.
On June 13, 2011 Hampton Roads Bankshares disclosed in an SEC filing that it lost $17 million during April and May 2011 as a result of provisions for loan losses totaling $14.4 million.

Shares of Hampton Roads Bankshares, Inc. (NASDAQ:HMPR) fell from almost $25 in the beginning of June 2011 to almost $10 in the end of June.