Citigroup Inc. (NYSE:C) has been named in a fraud suit over $1 billion in collateralized debt obligations.
Citigroup Inc. (NYSE:C) Hit By $1bn Fraud Lawsuit
Loreley Financing has sued the US banking giant Citigroup Inc. (NYSE:C) for fraud over the loss of about $1 billion of a sub-prime collateralized debt obligation investment.
Loreley demanded $965 million from the bank, saying that the bank failed to inform them of the risks of residential mortgage-backed securities.
Loreley said that the bank sold $965 million of notes in CDOs between September 2006 and July 2007 which are worthless now.
Citigroup Inc. (NYSE:C) spokeswoman Danielle Romero-Apsilos said, “We believe the suit is without merit”.
Citigroup Inc. (NYSE:C) stocks were at 29.90 at the end of the last day’s trading. There’s been a -5.5% movement in the stock price over the past 3 months.