SEC settles with Citi over $2bn bond losses, but fails to name names

Citi Building Sign

How can we expect Wall Street’s me-first culture to change when regulators won’t pursue or even identify the me-firsters who are directly involved?

The New York Times reports that question came to mind after reading the terms of a settlement struck on August 17 between the Securities and Exchange Commission and two units of Citigroup.

It is a deal that holds no one at the bank accountable for behaviour that caused investors to lose an estimated $2bn.

The settlement involved a disastrous municipal bond strategy the bank concocted and peddled to 4,000 wealthy clients from 2002 until early 2008. It was sold to investors as a safe-money option, even though it used considerable leverage, which always brings hazards when assets decline.

The S.E.C. contended that officials at Citi did not disclose the risks in the investment strategy. 

To access the complete New York Times article hit the link below:

An S.E.C. Settlement With Citigroup That Fails to Name Names

A Wild Month on Wall St. Ends Quietly

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