Citigroup Returning Billions To Investors

Accused Of Fraudulent Securities Sales, Financial Giant Cuts Settlement Deal With Regulators

(AP)  Citigroup Inc. will buy back more than $7 billion in auction-rate securities and pay $100 million in fines as part of settlements with federal and state regulators announced Thursday.

Citigroup will buy back the securities from tens of thousands of investors nationwide under separate accords with the Securities and Exchange Commission, New York Attorney General Andrew Cuomo and other state regulators. The buybacks will have to be completed by November.

The nation's largest financial institution also will pay a $50 million civil penalty to New York state and a separate $50 million civil penalty to the North American Securities Administrators Association, which represents securities regulators in the 50 states and the District of Columbia.

The SEC also will consider levying a fine on Citigroup, the agency's enforcement director Linda Thomsen, said at a news conference.

New York-based Citigroup neither admitted nor denied wrongdoing under the settlements.

Cuomo had threatened to charge Citigroup with fraudulent sales of auction-rate securities and with the destruction of key documents.

The $330 billion auction-rate securities market involves investors buying and selling securities backed by municipal bonds, student loans and other debt. The market collapsed in February amid turmoil in the credit markets.

"More than 50 percent of our retail clients' holdings in (auction-rate securities) have been redeemed or auctioned at par since the crisis began," Citigroup said in a statement. "We remain committed to continuing our work on initiatives that will secure the best and fastest route to providing liquidity to our clients."

The federal and state regulators have been investigating marketing of the securities by a number of big banks.

Cuomo's office sued the Swiss bank UBS AG last month over billions of dollars in sales in auction-rate securities, and states including Massachusetts and Texas have filed similar complaints. Massachusetts last week accused Merrill Lynch of fraud in promoting the sale of auction-rate securities.

Interest rates on the securities are set at periodic auctions, on the basis of bids submitted.

[wardoglrs]

What No Prison time for any of these A holes?. They get to keep there jobs and not shut down there business?. And just who gets the bill?. Yup you get the bill and the rest of us will need to get the rope''s.

[iphyt4u]

Of course they''ll pay them back. The government is giving them your tax dollars. This is what we call republican welfare. In the mean time, John Q. Public, can''t make ends meet. But hey, at least Bush''s wealthy buddies get their money back.

[fstop100]

how much did they steal that they can pay this much back?

[wardoglrs]

And to think there are no charges Mentioned, UnFlipping Believable. What a bunch of crooks they dont even lose there licence. Move along nothing to see here. Time to get a rope

[sociald63]

yo citi-crooks: i want my 10 dollars back

[dashortround]

Too bad that it took having a Congressional gun held to their heads to finally "do the right thing".

Typical "Big Business" greed...

[seajay09]

In addition,,, where is the " I R S ",,,

[seajay09]

Besides paying the fine, CitiGroup should be facing the RECO statues,,, that would really punish them, right out of business (5 Times) the money lost 7Billion,,, compared to only 100 Million.

[lochlan-2009]

Why is it if you steal a pach of cigarettes or EVEN A CAR you go to jail for, in many cases, years , but if you steal billions of $$$$ it''s no one''s fault, the company did it, and it will have to pay a fine?

American justice, for us, and for them.

[whitemale08]

All of these so called "top tier" banks that make up the founding of the illegal Federal Reserve System should be shut down.

Boones Pickens is a thief and an idiot. He''s running ads to hide the fact that the so-called wealth transfer actually was Treasury Secretary Hank the Snake Paulson tricking everybody into turning the Federal Reserve into a SUPER SIV!

All that "money" being handed out to investors is in no comparison of them literaly trading in the mountainous wothless loads of mortgage back and collaterized debt obligations (CDO) for actual cash at the discount window and now through Fannie and Freddie.

You guys are the worse and should be put in jail for your treasonous behaviour!

[omega39-2009]

Citigroup Inc. will buy back more than $7 billion in auction-rate securities and pay $100 million in fines as part of settlements with federal and state regulators announced Thursday.

Sure they will, with the federal reserve and US taxpayer standing by to step in and save citigroup from their bad decisions, it is no sweat off their nose.

[sparks224]

A friend of mine once said that without regulation, capitalism would self destruct.
Boy was he crazy.

[sparks224]

I%u2019m just glad no poor people are getting any of the money, because that would be socialism.

[txlakeside]

The SHRUB plan for Corporarte Welfare is working very well. Free money from the GOV gives the failing lenders an out. Struggling lenders get 2% interest loans that provides them a comfortable cushion when they loan 2% money out at 6%. And as with all repub coporate welfare programs the taxpayers will pay for it!

Run the worthless repubs out of office this Nov

[seajay09]

CitiGroup is made up of CitiBank, CitiCorp, Travelers Ins,and also SmithBarney; and they are NOT Chase Bank. However CitiGroup was involved with SEC violations as per the Cuomo investigation.

[seajay09]

correction,,, Citigroup is not the Rockefellers,,, that was Chase Bank,,,, Now called JPMorgan Chase,,,

Citigroup was CitiCorp, was CitiBank,,, sorry not the Rockefeller Family,,

[sistatee-2009]

Citigroup is the Rockefeller family *** honest people out of their last dime, like they''ve been doing for the last hundred years. This family deserves the same treatment that the Romanov family got in Russia; bullets through the back of their skulls.

[mgeg1]

I agree. Not only did they swindle people out of billions of dollars, but they are contributing to the total collapse of the American financial system. Because of what these a-holes are doing, it is going to become increasing difficult to get a loan for anything, especially student loans. If student loans go, so does our country.

[whiskyrokkr]

CROOKS!!!!! They need to do some serious jail time.