Citigroup Fair Fund

www.CitigroupFairFund.com


Frequently Asked Questions

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1. What was this case about?

On July 29, 2010, the Securities and Exchange Commission (“SEC” or “Commission”) filed a complaint (“Complaint”) alleging that defendant Citigroup Inc. (“Citigroup” or “Defendant”) violated Section 17(a)(2) of the Securities Act of 1933 (“Securities Act”), Section 13(a) of the Securities Exchange Act of 1934 (“Exchange Act”) and Exchange Act Rules 12b-20 and 13a-11. The Complaint alleges that from July 2007 through October 2007, Citigroup made a series of materially misleading statements concerning the extent of the company’s exposure to sub-prime mortgage-related assets in earnings calls and public filings.1 The Defendant entered into consent agreements and on October 19, 2010 the Court entered Final Judgment ordering the Defendant to pay disgorgement of $1.00, and a civil penalty in the amount of $75,000,000.00. Pursuant to the Final Judgment, on October 22, 2010, defendant Citigroup Inc. paid a total of $75,000,001 to the Clerk of the Court (the “Fair Fund”) under the case name designation “SEC v. Citigroup Inc., Case No. 10-cv-01277 ESH.” The Fair Fund was deposited into an interest bearing account and it constitutes a Qualified Settlement Fund (“QSF”) under Section 468B(g) of the Internal Revenue Code, and related regulations, 26 C.F.R. §§ 1.468B-1 through 5. By order dated December 17, 2010, the Court appointed Damasco & Associates LLP, now known as Miller Kaplan Arase LLP, as Tax Administrator to fulfill the tax obligations of the Fair Fund. By order dated October 6, 2016, the Court appointed Garden City Group, LLC (“GCG”) as the Distribution Agent for the Fair Fund to assist in overseeing the administration and the distribution of the Fair Fund in coordination with Commission staff, pursuant to the terms of this Distribution Plan (the “Plan”). Pursuant to the Final Judgment, the Fair Fund shall be distributed pursuant to the Fair Fund provisions of Section 308(a) of the Sarbanes-Oxley Act of 2002. Pursuant to a March 20, 2017 order of the United States District Court for the Southern District of New York, and pursuant to Section 308(b) of the Sarbanes-Oxley Act of 2002, as amended, $375,000 in residual distribution funds from the related class action, In re Citigroup Securities Litigation, 1:07-cv-09901 (SDNY) will be deposited into the Fair Fund. This Plan relates solely to the Fair Fund created in connection with the distribution described in the Order. Pursuant to the Final Judgment, the costs of distributing the Fair Fund shall be paid separately by the Defendant. This Plan sets forth the methods and procedures for distributing the Fair Fund. The distribution methodology allocates the Fair Fund amongst Eligible Claimants based on the Plan of Allocation herein, on a pro rata basis.


1 Complaint, SEC v. Citigroup Inc., 10-cv-1277 (D.D.C. 2010). On the same day the Commission filed this action against Citigroup, it instituted administrative proceedings against Citigroup’s former Chief Financial Officer, Gary Crittenden, and Citigroup’s former head of Investor Relations, Arthur Tildesley, for their roles in causing Citigroup to make certain of the misleading statements alleged in the Complaint. In their offers of settlement related to those proceedings, Messrs. Crittenden and Tildesley consented to the entry of a cease-and-desist order finding that each of them caused violations by Citigroup of Section 13(a) of the Exchange Act and Exchange Act Rules 12b-20 and 13a-11. In addition, Mr. Crittenden paid $100,000 and Mr. Tildesley paid $80,000 to the United States Department of Treasury.

2 Final Judgment as to Defendant Citigroup Inc. (D.D.C. 2010).

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2. Why did I receive a Notice?

You received a Notice because records indicate you may have purchased or acquired Citigroup common stock between February 26, 2007 and April 18, 2008, inclusive (the “Relevant Period”). The notice you received is designed to notify you of the settlement reached and to inform you that you may be eligible to receive payment from the Citigroup Fair Fund.

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3. Who is eligible to participate in the Fair Fund?

To qualify for a payment from the Citigroup Fair Fund, you must satisfy certain eligibility criteria that are described in detail in the Plan and the Plan of Allocation, attached to the Plan as Exhibit A. Those criteria include the following:

  1. You must have purchased or acquired Citigroup common stock during the Relevant Period, as described in the Plan of Allocation.
  2. Your approved transactions must calculate to a Recognized Claim and the Distribution Payment must equal or exceed $25.00.

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4. Who is excluded from participating in the Fair Fund?

You are excluded from participation in the Citigroup Fair Fund if you are:

  1. the defendants named in the Complaint or in the Class Action;
  2. members of the immediate families of the individual defendants named in the Complaint or in the Class Action;
  3. any firm, trust, partnership, corporation, present or former officer, director or other individual or entity in which any of the defendants named in the Complaint or in the Class Action have a controlling interest or which is related to or affiliated with any of the defendants named in the Complaint or in the Class Action;
  4. the legal representatives, heirs, successors-in-interest or assigns of any such excluded persons or entities,
  5. persons or entities whose only acquisition of Eligible Securities during the Relevant Period was via gift or inheritance if the person from which the Eligible Securities were received did not themselves acquire the Eligible Securities during the Relevant Period. The Proof of Claim Form will require all Claimants, other than Class Action Authorized Claimants who do not amend their claims, to certify that that they are not an Excluded Party.
  6. A director or officer of Citigroup during the Relevant Period.
  7. Citigroup’s directors’ and officers’ liability insurance carriers, and any affiliates or subsidiaries thereto.

Please note that for purposes of the Citigroup Fair Fund, the parties have defined a "Director" as a member of the Citigroup Inc. Board of Directors. The term "Officer" is defined as a president, principal financial officer, principal accounting officer, controller, any vice-president in charge of a principal business unit, division or function (such as sales, administration or finance), any other officer who performs a policy-making function or any other person who performs similar policy-making function.

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5. What is the amount of the Fair Fund?

Pursuant to the Final Judgment, on October 22, 2010, defendant Citigroup Inc. paid a total of $75,000,001 to the Clerk of the Court (the “Fair Fund”) under the case name designation “SEC v. Citigroup Inc., Case No. 10-cv-01277 ESH.”

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6. What do I need to do to participate in the Fair Fund?

If you submitted a Proof of Claim Form in the settlement of the related securities Class Action, entitled, In re Citigroup Securities Litigation and your claim was approved, you are automatically deemed an Eligible Claimant with respect to those transactions that were approved and you do not need to submit a Proof of Claim Form for those previously approved transactions.

If you submitted a claim in connection with the Class Action that was determined to be deficient and failed to cure the deficiencies, you must provide the required information and/or documentation to cure the deficiencies in your Class Action Claim. Please do not re-submit the same Proof of Claim Form and documentation previously submitted.

If you did not submit a claim in the Class Action or you wish to file a claim for additional transactions not included in your Class Action Claim, you must complete and sign the Proof of Claim Form and submit it, along with appropriate documentation, to the Distribution Agent so that it is received no later than August 31, 2018 at the address listed below in order to be eligible to recover from the Citigroup Fair Fund:

SEC v. Citigroup Inc.
c/o GCG
P.O. Box 10345
Dublin, OH 43017-5545

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7. What do I need to submit with my Proof of Claim Form?

You must document each transaction that you include on your Proof of Claim Form. Acceptable forms of supporting documentation include, but are not limited to:

  1. Trade confirmation slips from brokerage firms that list the security name, the name of the beneficial owner, the type of transaction, the date of the transaction, the number of share, and the total amount of the transaction; or
  2. Monthly statements from brokerage firms that detail all activity within a month.

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8. The Proof of Claim Form requests an account number, where can I obtain this information?

Most brokerage firms and financial institutions assign account numbers to your account for easier reference. This number is typically included on the statements you receive. Please include your account number on page 2 of the Proof of Claim Form.

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9. What is the deadline for submitting my Proof of Claim Form?

The deadline to submit a completed and signed Proof of Claim Form with the necessary documentation has been extended until August 31, 2018. The Proof of Claim must be postmarked by this date.

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10. Will I be notified if my Proof of Claim Form is deficient?

Yes. If your Proof of Claim Form is deficient, you will receive a Claim Deficiency Notice setting forth the reason why the claim is deficient and advising you of the opportunity to cure such deficiency.

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11. Can a financial institution that served as an advisor to numerous clients file Proof of Claim Forms on their behalf? Can all clients be grouped together using this method?

Yes, you may file on behalf of all your clients, provided you are authorized to do so and provide us with valid written authorization. If you would like to file these claims together, you should file your claims electronically.

Please Note: Claims with 100 or more transactions or on behalf of 20 or more different account must be submitted electronically and in the required format. You can obtain the mandatory electronic filing requirements and file layout on this website or you may e-mail the Distribution Agent at eClaim@choosegcg.com. Any submission not in accordance with the required electronic filing format may be rejected. Proof of authority to submit a Proof of Claim Form on behalf of any managed accounts must be submitted with any Proof of Claim Forms for such accounts. If you intend to file electronically, you can submit and track the history of your claims by using our secure website, GCG ICETM , which is available 24/7. GCG ICETM allows institutional investors to upload electronic claims and documents, track the history and status of submissions, view claim rejections and how to fix them, update contact information, and receive important status alerts via e-mail.

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12. How much money will I receive if my claim is approved?

Until all claims have been fully processed, it is not possible to determine the amount of any individual payment because the amount will depend on a variety of factors, including the number of valid claims processed, the amount of Citigroup common stock that you purchased, and when you purchased these shares, and whether you sold these shares or held the shares through July 17, 2008. In addition, in order for a claim to be paid, the Distribution Payment must equal or exceed $25.00.

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13. Who is the Distribution Agent?

The Court has appointed Garden City Group, LLC (“GCG”) to serve as the Distribution Agent.

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14. Where can I obtain the Plan, Notices and Proof of Claim Form?

You can obtain the Plan, Notices and Proof of Claim Form by either downloading these documents from this website by clicking on the tabs to the left, or the documents can be requested by mail to:

SEC v. Citigroup Inc.
c/o GCG
P.O. Box 10345
Dublin, OH 43017-5545

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15. How do I get more information?

Additional information regarding the Citigroup Fair Fund can be found on this website. You can obtain additional information or request copies of documents by calling the Citigroup Fair Fund’s toll-free hotline at (866) 879-4189, or by email at Questions@CitigroupFairFund.com.

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