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Federal Court Decision – Judge Rejects Citi’s Settlement with SEC

By Jonah Toleno of Shustak Reynolds & Partners, P.C. posted on Monday, November 28, 2011.

In a recent court decision, New York Federal Judge Jed Rakoff denied a motion to approve a settlement between Citigroup and the SEC arising out of charges that Citi misled investors about collateralized debt obligations. Judge Rakoff rejected the highly publicized settlement, consisting, in part, of a $285 million payment by Citi without any admission or denial of wrongdoing, on grounds he had insufficient facts on which to approve the agreement. The judge stated, “[i]n any case like this that touches on the transparency of financial markets whose gyrations have so depressed our economy and debilitated our lives, there is an overriding public interest in knowing the truth.” The judge, appearing bent on procuring more facts about Citi’s conduct and whether it complied with the obligations imposed by the SEC, has set a trial date of July 16, 2012. Our firm regularly handles cases involving investor fraud and misrepresentation. Please contact us at (619) 696-9500 or visit our website at www.shufirm.com if you would like a free consultation about a current or pending investment with a broker-dealer.

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