SEC Defends Citi Settlement

[Dover]

Source: WSJ

NEW YORK— The Securities and Exchange Commission on Monday defended its proposed $285 million settlement of fraud charges against Citigroup Inc. over a mortgage-bond deal.

Last month, U.S. District Judge Jed S. Rakoff questioned why he should approve that pact, challenging the boilerplate language often used to resolve such cases. The judge asked the parties why he should approve the settlement of "a serious securities fraud" case where the defendant neither admits nor denies wrongdoing.

The judge demanded that both sides appear for a hearing Wednesday on the settlement, which was reached Oct. 19.

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Read more: http://online.wsj.com/article/SB10001424052970204190704577024070780201362.html?mod=WSJ_business_whatsNews

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U.S. judge skeptical of Citigroup-SEC accord

(Reuters) - A federal judge expressed deep skepticism about a proposed $285 million civil settlement between the top U.S. market regulator and Citigroup Inc over charges that the bank defrauded investors.

A written order by U.S. District Judge Jed Rakoff was the latest to put U.S. Securities and Exchange Commission settlements with major banks under scrutiny.

Two years ago, Rakoff himself rejected an SEC accord with Bank of America Corp, later approving revisions only grudgingly, and Thursday's order suggests another showdown with the regulator may be in the offing.

..//..

The SEC and criminal prosecutors are under pressure from lawmakers and the public to bring cases that hold Wall Street executives accountable for their role in the 2007-2009 financial crisis that triggered a deep global recession.

cont'd
http://www.reuters.com/article/2011/10/27/us-citigroup-sec-idUSTRE79Q5XD20111027

[russspeakeasy]

1. Does that equal 1/2 of 1 % of what they stole ?

[Hubert Flottz]

2. And they don't even want to pay that 1/2%

Or any taxes.

If you stole $1,000. your ass would probably go to jail.

[Javaman]

3. The SEC? That's a laugh.

that's like trusting an arsonist to make sure all the fires are out.

[Vincardog]

4. Citi defrauded me and caused my to declare bankruptcy. They need to go to JAIL

[elleng]

5. The Judge will put them (SEC+) on the hot-seat, in public, Wednesday, IMO.

:thumbsup:

[muriel_volestrangler]

6. Yep, but it doesn't seem he can force them to prosecute them properly

A federal judge Wednesday challenged the SEC’s plan to settle a fraud case against Citigroup for $285 million, saying that the deal would recoup only a fraction of investors’ losses and would leave the firm free to proclaim its innocence in private lawsuits over the remaining damages.

The judge used the Citigroup case to mock the SEC’s traditional way of doing business — allowing defendants to settle without admitting or denying wrongdoing.
...
The standard neither-admits-nor-denies clause means the SEC settlement could not be used as proof of guilt by investors suing Citigroup on their own. Citigroup could assert its innocence in those disputes, Rakoff said.

“So why do you want to require the private parties to have to re-prove what you believe you can already prove?” Rakoff said. “(W)hy does it make any sense?”

http://www.washingtonpost.com/business/economy/judge-chafes-over-citigroup-settlement/2011/11/09/gIQAQ13m6M_print.html

[lonestarnot]

7. Good! Fucking perfect! Wednesday should be an exciting day. ALEC we welcome you to Phoenix!

:evilgrin:

[lonestarnot]

8. Shit! Too late to rec.

[wordpix]

9. at least ONE judge is trying to hold people accountable, including the SEC

hurray for that.

But until Wall St. cleans up its act, I'm not investing.

[lovuian]

10. SEC is corrupt and thieves watching thieves

they all need to be fired after this

[JCMach1]

11. If corporations are peope, then bring on the corporate death penalty

CITI, you are on the list!

[Huey P. Long]

12. Regulatory capture, revolving door, fascism.