Citigroup Inc. Broker Misconduct

In November 2008, Citigroup became the recipient of more than $306 billion of government aide, because Congress deemed the company “too big to fail.” Citigroup had brought in $160 billion of revenue the previous year and at the time had employed more than 300,000 people in the United States.

Citigroup has had a history of deceiving investors on a large scale, and has been a part of a myriad of scandals leading up to the government bailouts. In 2005, Citigroup agreed to repay investors $2 billion after it was alleged the firm helped engineer Enron’s massive accounting fraud at the turn of the century. That settlement came on the heels of Citigroup’s $2.65 billion deal with investors after the firm had acted as lead banker to WorldCom.

The trouble has certainly not ended for Citigroup, who have been fined by FINRA for numerous trade violations. The firm agreed with the government to buy back $7.3 billion in auction-rate securities that FINRA said were marketed inappropriately to investors. Citigroup was also ordered to pay a $100 million fine to federal regulators.


FURTHER READING

• Citigroup to Buy Back $7 Billion in Auction-rate Securities
• Citigroup Agrees to Pay $2B to Settle Enron Lawsuit
• Five Questions (And Answers) About Citi’s Bailout
• Citigroup Agrees to a Settlement Over WorldCom