Citi to face $500m rogue trader lawsuit

Dog Detective

Trader hid mounting trading losses for at least five years before they were revealed.

AIB has won approval in a US court to pursue a $500m fraud claim against Citigroup, which the bank alleges helped so-called rogue trader John Rusnak to run up a $691m loss.

Irish Times reports that in the latest instalment in the long-running case, Manhattan-based US district Judge Deborah Batts earlier this week declined to dismiss AIB’s claim, which involves the bank seeking $500m of compensatory damages as well as punitive damages from Citigroup.

Rusnak committed the fraud at AIB’s former subsidiary Allfirst Bank in Baltimore, where he hid mounting trading losses for at least five years before they were revealed in February 2002. The scandal, which was at that stage one of the biggest rogue trading incidents on record, almost brought down Allfirst.

AIB later sold the Baltimore bank to M&T, based in New York.

To access the complete Irish Times article hit the link below:

AIB can sue Citigroup over rogue trader John Rusnak, says judge

Banking inquiry to hear evidence from Brian Cowen

JefferiesAnd the Best Place to Work in the global financial markets 2016 is...

Register for Financial Markets News Alerts