Getting sued by the Securities and Exchange Commission and domestic investors is sort of par for the course for America’s big banks these days, but gettings sued by a Scandinavian country, that’s really something special. Norway’s central bank has sued Citigroup, its CEO Vikram Pandit and chairman Richard Parsons because it suffered $835 million in losses in Citigroup stock and bonds, Bloomberg reports. Ex-CEO Chuck Prince is also named in the suit.
The Norwegian bank says that Citi misrepresented its stock and bonds as a safe investment when, in fact, it was headed for a downward spiral that would ultimately lead Uncle Sam to shell out $45 billion to bail out the company. The U.S. taxpayer currently owns 18 percent of the company.
Norges Bank invested in Citi from 2007 to 2009. From the start 2007 to the end of 2008, Citi shares lost 88 percent of their value, and then fell further in 2009. So it’s not entirely surprising that the Norwegians are upset
It’s just the latest in a series of suits filed by irate investors over Citi’s massive 2007 losses tied to its subprime mortgage portfolio. In fact, just today, Citi’s lawyers tried to get a rather skeptical U.S. District Court judge to accept a settlement between the bank and the Securities and Exchange Commission.
Citi said it believes the Norway lawsuit has no merit.