US banking giant Citigroup said Monday it will pay $730 million to settle a class-action suit by bondholders related to the 2008 financial crisis.
The suit alleged Citigroup misled buyers of its bonds over its exposure to subprime mortgages and other high-risk securities ahead of and during the crisis, from May 2006 to November 2008.
The settlement is the latest step by Citi to put the ill-effects of the financial crisis behind it. Citi was harmed more by the crisis compared with some peers, such as JP Morgan.
The plaintiffs had argued that Citigroup misrepresented its exposure to mortgage-related assets, according to Bernstein Litowitz Berger & Grossman, the plaintiffs attorneys.
Citi also understated the loss reserves for its mortgage loans and “falsely stated” that assets held off its balance sheet were of high value, Bernstein Litowitz said.
“It wasn’t until November 2008, when the bank received substantial government assistance, that investors learned the full truth about Citigroup’s financial condition,” the law firm said.
In a statement, Citi denied the allegations, but said it was settling the case “solely to eliminate the uncertainties, burden and expense of further protracted litigation.”
Citi called the settlement, which must be approved by the US district court, “another significant step toward resolving our exposure to claims arising from the financial crisis.”
“We look forward to putting this matter behind us,” the bank said.
The plaintiffs in the case included the Arkansas Teacher Retirement Systems and the Louisiana Sheriffs’ Pension and Relief Fund.
In August 2012, Citi announced a $590 million settlement with investors in Citigroup shares who had charged that the company hid its exposure to the collateralized debt obligations market in order to prop up its share price.
The investors took heavy losses after the losses became public and Citi’s share price tanked.
In that case, Citi also denied the substance of the allegations and said it was settling to avoid any more legal costs.
MSNBC’s Morning Joe rains hell on Democrats for arguing over ‘academic politics’ instead of Trump’s ‘threat to democracy’
MSNBC's Joe Scarborough blasted Democratic presidential candidates for basically ignoring the constitutional and national security threat coming from the White House.
The "Morning Joe" host said Wednesday night's debate focused too much on "academic politics," which he said is a luxury this current political moment can't afford.
"It seems to me that the battles that we see in these debates remind me of the smallness of academic politics," Scarborough said. "The smallness, the difference, the minutia between, 'Did I help you get that passed, did you get that passed, you owe me this, I thank President Obama, but I don't thank you' -- come on, man."
Italy court to rule on iconic Da Vinci loan to Louvre
An Italian court is to rule Wednesday on whether Leonardo da Vinci's iconic Vitruvian Man drawing can be loaned to France's Louvre, bringing to a head a bitter cultural row.
The Venice court last week suspended the loan of the world famous artwork, due to appear later this month in an exhibition at the Paris museum to mark the 500th anniversary of the artist's death.
It did so after an Italian heritage group, Italia Nostra (Our Italy), filed a complaint saying the drawing was too fragile to travel.
The Vitruvian Man is kept in a climate-controlled vault in the Accademia Gallery in Venice and is rarely displayed to the public.
Austrian man held in Dutch cellar family ‘waiting for end of time’ case
Dutch police were holding an Austrian man after the discovery of a father and his adult children who were believed to have stayed hidden in a remote farmhouse for years, officials said Wednesday.
The mystery surrounding the case in the village of Ruinerwold in the northern province of Drenthe also deepened with reports that one of the children had been active on social media this year.
Police said they discovered a father and five children aged between 18 and 25 on Monday and arrested a 58-year-old man -- not the father -- for failing to cooperate. They initially spoke of six children but later revised the number down.