NEW YORK (Legal Newsline) – Bernstein Litowitz and the Florida firm Klausner Kaufman have filed a securities class action against Citigroup in New York federal court.
Their plaintiff is the City of Sunrise Firefighters’ Pension Fund, which claims in the Oct. 30 lawsuit that Citi’s risk management evaluation exposed the company to more than $1 billion in regulatory penalties.
A month ago, Citigroup was fined $400 million. In September, when it became evident penalties were coming, the company’s stock dropped from $51 per share to $43.68 by October.
The company had mistakenly sent Revlon creditors $900 million of its own funds. Citi said it would boost investment in internal procedures by $1 billion.
“In total, because of Citi’s deception relating to its internal controls and compliance systems, $17.43 billion of shareholder value has evaporated and class members were the ones who suffered from the defendants’ actions.