NEW YORK–(BUSINESS WIRE)–Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, announces that a class action lawsuit has been filed in the United States District Court for the Southern District of New York on behalf of investors that purchased Citigroup, Inc. (NYSE: C) common stock between February 25, 2017 and October 12, 2020 (the “Class Period”). Investors have until December 29, 2020 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
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The Class Period begins on February 25, 2017, following the Company’s submission of its 2016 Annual Report to the SEC. In that filing, and throughout the Class Period, Citi assured investors that there were no significant deficiencies or material weaknesses in the Company’s internal controls. When faced with periodic regulatory penalties for noncompliance, the Company continued to assure investors that the specific deficiencies at issue were being remediated promptly and that internal controls and regulatory compliance were a top priority at Citi. In particular, Citi assured investors that it satisfied all regulatory requirements and maintained adequate internal controls, data governance, compliance risk management, and enterprise risk management.
In reality, during the Class Period and unbeknownst to investors, Citi’s internal controls and risk management capabilities suffered from “serious” and “longstanding” inadequacies that exposed the Company to massive regulatory penalties and will cost significantly more than $1 billion to remediate. Specific control failures about which Citi executives were warned remained unresolved for years and the Company’s culture of non-compliance was so widespread that Citi’s CEO, Defendant Michael Corbat, exhorted employees in an internal memo that regulatory compliance required more than “checking boxes.”
The truth began to emerge on September 14, 2020, when reports surfaced that regulators were preparing to reprimand Citi for failing to improve its risk-management systems.
That disclosure caused the price of Citi’s stock to decline $2.85 per share, from $51.00 to $48.15, erasing $5.91 billion in shareholder value.
After the market closed on September 14, 2020, an internal memo sent to Citi employees revealed for the first time the Company’s disregard for adequate internal controls and regulatory compliance.
As a result, the price of Citi’s stock declined an additional $3.34 per share, from $48.15 to $44.81, erasing $6.93 billion in shareholder value.
Then, on October 13, 2020, Citi reported earnings for the third quarter of 2020, and disclosed that the Company’s expenses increased during the third quarter by 5%, to $11 billion, due to an increase in costs including a $400 million fine, investments in infrastructure, and other remediation costs related to control deficiencies.
These disclosures caused Citi’s stock price to decline by $2.20 per share, from $45.88 to $43.68, erasing $4.57 billion in shareholder value.
If you purchased Citigroup common stock during the Class Period and suffered a loss, are a long-term stockholder, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker, Melissa Fortunato, or Marion Passmore by email at email@example.com, telephone at (212) 355-4648, or by filling out this contact form. There is no cost or obligation to you.
About Bragar Eagel & Squire, P.C.:
Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York and California. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.