Citigroup, Inc (NYSE: C) has been sued by Norway’s Central Bank, Norges Bank, over $835 million worth of losses in Citigroup stock and bonds.
The New York-based bank is accused of making “repeated material untrue statements and non-disclosure of material information to investors” between January 19th, 2007 and January 15th, 2009, allegedly causing Norges Bank to purchase securities at inflated prices. The complaint names more than 20 Citigroup directors and executives, including both Vikram Pandit and his predecessor Charles Prince.
The suit, which was filed on September 17th in United States District Court in Manhattan, says “When the market slowly learned the truth of Citi’s financial condition, Citi came close to insolvency, and Plaintiff lost a substantial amount of its investment. Citi’s near-demise had its genesis in the Company’s increasing willingness to take on risks for the sake of profit, without regard for – and without disclosing – the magnitude of the downside exposure it faced if those risks materialized.”
“We believe the suit has no merit and will defend ourselves vigorously,” a Citigroup spokeswoman said in a statement.
Citigroup Inc. (Citigroup) is a global diversified financial services holding company. The Company provides consumers, corporations, governments and institutions with a range of financial products and services. As of December 31, 2009, Citigroup had approximately 200 million customer accounts and did business in more than 140 countries. Citigroup operates through two primary business segments: Citicorp, consisting of its Regional Consumer Banking (RCB) businesses and Institutional Clients Group (ICG), and Citi Holdings, consisting of its Brokerage and Asset Management (BAM), Local Consumer Lending (LCL), and Special Asset Pool (SAP). In April 2010, Barclays PLC acquired Italian credit card business of Citibank International Bank plc. In May 2010, the Company announced the creation of a new Collateral Management Services unit within its Securities and Fund Services business.
Shares of Citigroup, Inc (NYSE: C) traded up 2.74% during mid-day trading on Monday.
