If you purchased or acquired Citigroup Inc. (“Citigroup” or “Defendant”) common stock including Citigroup common stock acquired in Citigroup’s Voluntary PA Capital Accumulation Program (“FA Cap”), (“Eligible Securities”) between February 26, 2007 and April 18, 2008, inclusive (the “Relevant Period”), you may be entitled to a recovery from the Fair Fund (AS DEFINED BELOW).
On July 29, 2010, the SEC filed a complaint (“Complaint”) alleging that the 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 filings1. The Defendant entered into consent agreements and on October 19, 2010 the Court entered a Final Judgment ordering the Defendant to pay disgorgement of $1.00, and a civil penalty in the amount of $75,000,0002. 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 under Section 468(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 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 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.
The Fair Fund is separate and independent from the settlement funds previously established in the related securities class action settlement, entitled In re Citigroup Inc. Securities Litigation, No. 07 CIV. 9901 (S.D.N.Y.) (SHS), pending in the United States District Court for the Southern District of New York (the “Class Action”). However, the Fair Fund relates to allegations similar to those asserted in the Class Action and to purchases of Eligible Securities during the Relevant Period, which is the same time period at issue in the Class Action.
If you previously filed an approved claim in the Class Action and do not wish to amend your claim, do not submit another Proof of Claim. You will automatically be deemed to be an Eligible Claimant with respect to transactions in the Class Action for which your claim was approved.
If you previously filed a claim in the Class Action that was determined to be deficient and you failed to cure such deficiencies, and you wish to participate in the Fair Fund, you must submit documentation to support your claim so that it is received no later than August 31, 2018. You may submit additional documentation in the following ways: by email to Questions@CitigroupFairFund.com, or by mail to SEC v. Citigroup Inc., c/o GCG, P.O. Box 10345, Dublin, OH 43017-5545.
If you did not previously file a claim in the Class Action and wish to participate in the Fair Fund, you must submit a Proof of Claim Form and documentation, which must be postmarked or, if not mailed, received no later than August 31, 2018. You may download a Proof of Claim Form by clicking here; after you complete the form, you should submit it as instructed above.
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).