Citigroup to Pay $285 Million to Settle Fraud Case

[Hissyspit]

Source: Reuters

Citigroup to pay $285 million to settle fraud case
By Jonathan Stempel and Aruna Viswanatha
Wed Oct 19, 2011 3:21pm EDT

By Jonathan Stempel and Aruna Viswanatha

(Reuters) - Citigroup Inc will pay $285 million to settle charges that it defrauded investors who bought toxic housing-related debt that the bank bet would fail, the U.S. Securities and Exchange Commission said on Wednesday.

The SEC said the bank's Citigroup Global Markets unit misled investors about a $1 billion collateralized debt obligation by failing to reveal it had "significant influence" over the selection of $500 million of underlying assets, and that it took a short position against those assets.

It said one experienced CDO trader called the portfolio "possibly the best short EVER!" while an experienced collateral manager said "the portfolio is horrible."

In a statement, Citigroup said the SEC did not charge the unit with any "intentional or reckless misconduct" and that the settlement "resolves all outstanding SEC inquiries into those activities."

Read more: http://mobile.reuters.com/article/idUSTRE79I4TL20111019?irpc=932

[DCKit]

1. There really need to be arrests and prosecutions.

When it's all said and done, it's U.S. paying the fines and suffering the economic losses.

[onethatcares]

2. fines and sanctions don't mean shit unless they hurt

and a 285 million dollar fine paid for by the citizens of the United States will not hurt Citigroup at all.

What they should have done is take every upper level honcho that was working there at that time and break their legs, throw them into solitary confinement and give their peachykeen homes, cars, and toys to the rabble.

that would hurt.

[SharksBreath]

3. So the criminal indictments will be

sent out tomorrow.


Right.

[DocMac]

6. LOL!

[Hell Hath No Fury]

4. Dupe -

[JJW]

5. Uncork the champaign at Citigroup

looks like they made out like bandits. And why not, they've got the loot to exercise SCOTUS'S definition of person-hood & free speech (more commonly known as corporations bribing public officials).

[DocMac]

7. This and BofA is why we MUST support OWS.

Nothing will change unless this movement succeeds. And the wisdom within DU can help.

Why have we not started debating in parallel with OWS? This may be a political site, but I have never seen better debate and truth forced to surface than here. I would like to see an OWS category added for just that.

I don't wish to influence them, but advisors we could be. There is much at stake!

[coyote]

8. $285 million? Isn't that like the yearly bonus for the CEO n/t

[BR_Parkway]

9. Contact the judge before it gets approved -

The settlement requires court approval. The case was assigned to U.S. District Judge Jed Rakoff in Manhattan, who chastised the SEC and ultimately rejected its proposed $33 million settlement in 2009 with Bank of America Corp over that bank's purchase of Merrill Lynch & Co. He later grudgingly approved a revised $150 million accord.

Hon. Jed S. Rakoff
United States District Judge

Daniel Patrick Moynihan
United States Courthouse
500 Pearl St.
New York, NY 10007-1312

Courtroom: 14B
Chambers Phone: [phone]

Deputy Phone:
[phone]