Revealing Emails Show Citi (C) May Have Mislead Investors, Employees
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No matter how you define it, vanilla ice cream is pretty straight forward: sugar, vanilla beans, cream, milk, maybe some egg yolks. If you're Citi (NYSE: C), then vanilla might be made with pickles, cumin, cilantro, pot roast, or whatever it is you're trying to sell.
At least, recently uncovered emails paint that sort of picture.
According to FOX Business Network, Citi allegedly committed several Inception-style lies about certain financial products that were so elaborate and believable, even sales-staff for the bank didn't know they were being told a lie. How were clients, then, supposed to know?
The investments -- dubbed Falcon and ASTA/MAT -- were billed as a stable, plain-vanilla investments, which would produce above market returns for investors. However, one top manager in Citi's global wealth management unit -- Maureen O'Toole -- became nervous that funds managers had gotten in over their heads. She emailed the co-heads of Citi's fixed-income alternative investments unit seeking assurance that the fixed-income funds were good for investors, FBN noted.
Citi is holding its own. In an email to FBN, the institution stated, "Citi acted appropriately at all times in connection with these investments...Our disclosures were accurate and complete and the investors who purchased these investments were highly sophisticated and knew of the risks involved."
Other email's sent within the firm painted a much more grisly picture. One Smith Barney financial advisor (FA) wrote, "We will not be defensible in arbitration... It is what was told to us (FAs) and in some cases directly to the clients by the Falcon/MAT portfolio manager that will be indefensible."
Another, "Sadly for our firm this is a gigantic disaster because of lack of proper disclosure."
Financials are taking a hit Monday, Citi itself is 5.3 percent lower on the session.
At least, recently uncovered emails paint that sort of picture.
According to FOX Business Network, Citi allegedly committed several Inception-style lies about certain financial products that were so elaborate and believable, even sales-staff for the bank didn't know they were being told a lie. How were clients, then, supposed to know?
The investments -- dubbed Falcon and ASTA/MAT -- were billed as a stable, plain-vanilla investments, which would produce above market returns for investors. However, one top manager in Citi's global wealth management unit -- Maureen O'Toole -- became nervous that funds managers had gotten in over their heads. She emailed the co-heads of Citi's fixed-income alternative investments unit seeking assurance that the fixed-income funds were good for investors, FBN noted.
Citi is holding its own. In an email to FBN, the institution stated, "Citi acted appropriately at all times in connection with these investments...Our disclosures were accurate and complete and the investors who purchased these investments were highly sophisticated and knew of the risks involved."
Other email's sent within the firm painted a much more grisly picture. One Smith Barney financial advisor (FA) wrote, "We will not be defensible in arbitration... It is what was told to us (FAs) and in some cases directly to the clients by the Falcon/MAT portfolio manager that will be indefensible."
Another, "Sadly for our firm this is a gigantic disaster because of lack of proper disclosure."
Financials are taking a hit Monday, Citi itself is 5.3 percent lower on the session.
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