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Citigroup to Pay $730 Million to Settle Class-Action Suit by Investors

Source: Dow Jones

Posted on 19 Mar 2013 by Neilson

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Citigroup class action suitCitigroup Inc. (C) has agreed to pay $730 million to settle a class action brought on behalf of investors who were allegedly misled by the bank's disclosures.

The investors bought Citigroup debt and preferred stock between May 2006 and Nov 2008 and the suit claimed the investors were misled by misstatements and omissions in the company's disclosures during the period.

The bank, in a statement, said it denies the allegations and is settling to eliminate the uncertainties, burden and expense of further protracted litigation. It said the settlement to be paid will be covered by its existing litigation reserves.

The proposed settlement is pending court approval.

In January, Citigroup reported that its fourth-quarter profit rose more than 25%, even as the bank continued to get stung by mortgage ills lingering from the financial crisis.