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.
Trump is facing massive criticism for his attacks on young women of color in Congress
US President Donald Trump came under fire from Democrats and even some members of his own Republican Party on Monday after launching an extraordinary xenophobic attack on four progressive Democratic congresswomen.
"All they do is complain," Trump told reporters at a White House event featuring products "Made in America."
"These are people that hate our country," he said of the four lawmakers. "If you're not happy here, you can leave."
Trump also accused the four first-term congresswomen -- who are of Hispanic, Arab, Somali and African American origin -- of having "love" for US "enemies like Al-Qaeda."
Trump’s campaign is spending massively at his own businesses — and even more on lawyers
President Donald Trump's 2020 re-election campaign filed their latest campaign finance reports on Monday.
Anna Massoglia, a researcher at the money in politics watchdog group Open Secrets, dissected the numbers and made two startling discoveries.
In the three months covered, from April through June, Trump's campaign and affiliated joint fundraising committees spent $326,094.24 at Trump businesses, including six figures at both Mar-a-Lago and Trump Hotel DC.
Trump's campaign also spent over $1.3 million on legal bills. He spent approximately $7 million on legal bills in 2018, Massoglia noted.
Trump is ‘one pointy white hat shy of a Klan rally’: GOP strategist Rick Wilson ripped Trump as a ‘flagrant racist’ on MSNBC
Republican strategy ripped President Donald Trump for being a "flagrant racist" during a Monday night appearance on MSNBC.
Lawrence O'Donnell interviewed Wilson about Trump's latest nativist attacks on young women of color in Congress.
"Rick Wilson, is this a campaign strategy? Is this Donald Trump and his campaign advisers thinking, well, our only hope is going for the voters we already have and energizing them and getting them to come and squeak out that electoral formula once again?" O'Donnell asked.
"Absolutely, Lawrence. As everyone else stated on the show, it’s been obvious for a long time from the long arc of his dad to redling to the Central Park Five to birtherism to this stuff today, this guy, he's racist adjacent in of the best day of his life," Wilson is explained.