CNN reports that Citigroup has described as 'pure fantasy' a series of e-mails its former star telecoms analyst Jack Grubman sent out in 1999 saying that he was pressured to upgrade AT&T stock.
US federal and state regulators have apprently uncovered e-mails written by Grubman which complain that he was forced to uprate AT&T stock as Citigroup was to benefit from continuing lucrative advisory and underwriting work.
Citigroup has said that Grubman simply fabricated the events detailed in the e-mails and, what's more, claim that he has confirmed to regulators that they had a 'zero basis' in reality.
In the meantime Citigroup boss Sandy Weill has confirmed that he did indeed asked Grubman to 'take a fresh look' at AT&T but he did so on the basis that Grubman was clearly free to make his own judgement. Grubman, who had previously been neutral on AT&T, upgraded his rating on the company stock to 'buy' after Weill suggested that he take that 'fresh look'.