LENDING & CREDIT | Staff Reporter, Singapore

Citigroup to pay $285m penalty for misleading investors

This is the third-biggest fine for such conduct and SEC’s latest action against banks.

According to a Bloomberg report, the bank agreed to pay $285 million to settle U.S. regulatory claims it misled investors about a $1 billion financial product linked to risky mortgages that defaulted within months of its sale.

In the report, the Securities and Exchange Commission said Citigroup structured and sold the collateralized debt obligation in 2007 without telling investors that it helped pick about half the underlying assets and was betting they’d decline in value.

View the full report here

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