Asta Funding’s Takeover, Dividend Draw Shareholder Challenge

Asta Funding Inc.'s top executives were hit with a Delaware lawsuit claiming they helped the financial firm’s founding family retake control and drain $20 million from it while concealing major management problems.

The Chancery Court suit targets a majority of Asta’s board, including chairman and CEO Gary Stern, who founded the company along with his now-retired father, Arthur. It also names as a defendant Stern’s son Ricky, a senior vice president who’s Asta’s largest shareholder, with a 38% stake. The partly redacted complaint was made public Nov. 7 after being filed under seal Nov. 4 by an individual investor.

According ...