Securities Arbitration Lawyers BlogClass Action Suit Against Citigroup Results in $13.5 Million Settlement
Bank accused of misleading investors in proprietary alternative investments
A settlement has been reached in a class action against Citigroup, Inc. resulting in a $13.5 million payout by the banking giant. According to Law360, papers filed August 10, 2015 indicate Citigroup allegedly misled investors by allowing them to buy into the bank’s Corporate Special Opportunities fund without disclosing risky debt – debt that resulted in losses over $400 million.
In the October 2012 complaint filed by plaintiffs David Beach and Christopher Kelly, Citigroup is accused of misleading investors about trades made in the debt of ProSeiben, a German media company. According to the suit, Citigroup was to govern the fund, but violated scaling and concentration restrictions on investments.