On Monday, the Securities and Exchange Commission (SEC) ordered Citigroup Global Markets and Citigroup Alternative Investments to pay almost $180 million to settle charges that allege the firm recommended investors put money into two hedge funds. The SEC said that the units of the bank made “false and misleading statements” to customers about risky hedge fund investments, which raised $3 billion in capital from almost 4,000 investors. The two hedge funds were the ASTA/MAT fund and the Falcon fund, which invested in collateralized debt obligations (CDOs). The SEC said that even when the funds were collapsing, the units of Citigroup still accepted around $110 million from investors, and did not inform them about the failure of the funds. Firms such as Citigroup have an obligation to make suitable recommendations to their clients, and if they do not, can be held liable for financial losses. If you invested money with Citigroup, please call our securities law firm at 312-332-4200 to speak with an attorney about your options of suing Citigroup to recover financial losses.
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