One final development in the Citigroup-SEC settlement saga. Today, Judge Rakoff approved the $285 million proposed settlement of the SEC’s charges against Citigroup in connection with certain mortgage-backed securities transactions. This follows the Second Circuit’s decision on June 4th to vacate Judge Rakoff’s decision that rejected the settlement. In that 2011 decision, Judge Rakoff criticized the Citigroup-SEC settlement on a number of grounds, including that it allowed Citigroup to avoid admitting guilt. He was no less critical of the Second Circuit in his opinion approving the settlement, stating that the Court of Appeals “has now fixed the menu, leaving this Court with nothing but sour grapes.”
The case is U.S. Securities and Exchange Commission v. Citigroup Global Markets Inc., U.S. District Court for the Southern District of New York, No. 11-cv-7387. For additional commentary and analysis, see Judge Rakoff Says 2011 S.E.C. Deal With Citigroup Can Close, Approval of SEC-Citigroup Deal Leaves Rakoff With a Case of ‘Sour Grapes’, and U.S. Judge Reluctantly Approves SEC-Citigroup $285 Million Deal.