SEC Settlement Agreed
Following on from the recent auction rate securities issues Citibankl has reached an agreement with the SEC (Securities and Exchange Commission) in the United States.
The Securities and exchange Commission had investigated the sale and promotion of auction rate securities by Citibank and deemed them to have been misrepresented. Municipal bodies are the normal investors in these securities and they always want as risk free an investment as possible.
The way Citibank promoted the investments it was made to look as though they were quite close to typical cash holding investments and as such very safe. This was not the case though so the investors were misled by Citibank, which will now have to pay back their customers and also pay fines of around a hundred million dollars.