{"id":506,"date":"2009-04-26T17:36:45","date_gmt":"2009-04-26T17:36:45","guid":{"rendered":"https:\/\/www.stockbrokerfraudblog.com\/2009\/04\/wachovia_and_citigroup_settle"},"modified":"2022-01-13T13:50:51","modified_gmt":"2022-01-13T19:50:51","slug":"wachovia-and-citigroup-settle","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/wachovia-and-citigroup-settle\/","title":{"rendered":"Wachovia and Citigroup Settle Michigan ARS Case for $880 Million"},"content":{"rendered":"

\t\t\t\tWachovia Capital Markets LLC and Citigroup Global Markets Inc.<\/a> will settle allegations by the Michigan Office of Financial and Insurance Regulation that the firms misled investors who bought auction rate securities by paying a combined $880.3 million-$717 million for Citigroup and $159 million for Wachovia-to reimburse clients. The OFIR says the firms misled clients into thinking ARS were liquid like cash and were surprised when the market collapsed, freezing their assets. OFIR claims the securities were sold and marketed as if they were conservative investment and that the firms did not give investors information about the risks involved. <\/p>\n

Both firms will also pay $2.3 million to Michigan to resolve the ARS charges. Citigroup will pay $1.72 million per an administrative consent order and Wachovia will pay $654,000. According to OFIR, 90% of the funds will be placed in a general fund for the state, while the rest will go to the Michigan Investor Protection Trust for consumer education about a number of issues, including investment fraud. <\/p>\n

Just this March, Wachovia and Citigroup said they would pay back California investors over $4.7 billion after the investment firms were accused of misleading investors about investing in ARS. Also last month, the North American Securities Administrators Association set up a Web site so investors could find out how to file arbitration claims for damages stemming from ARS losses. <\/p>\n

Citigroup, Wachovia in $876M Mich. ARS Buyback, The Bond Buyer, April 17, 2009
\nMichigan regulators detail settlement with Citigroup, Wachovia over auction rate securities, Associated Press, April 16, 2009 <\/p>\n

Related Web Resources:<\/strong>
\nNorth American Securities Administrators Association<\/p>\n

Michigan Office of Financial and Insurance Regulation
\n Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Wachovia Capital Markets LLC and Citigroup Global Markets Inc. will settle allegations by the Michigan Office of Financial and Insurance Regulation that the firms misled investors who bought auction rate securities by paying a combined $880.3 million-$717 million for Citigroup and $159 million for Wachovia-to reimburse clients. 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