IE 11 is not supported. For an optimal experience visit our site on another browser.

Citigroup sued over Brazil stock deals

Global financial services company Citigroup Inc. is being sued by a fund management firm alleging it acted improperly in the sale of some shares, the Wall Street Journal reported on Tuesday.
/ Source: Reuters

Global financial services company Citigroup Inc. is being sued by a fund management firm alleging it acted improperly in the sale of some shares, the Wall Street Journal reported on Tuesday.

Globalvest Management Co., an emerging market fund manager, filed a $300 million civil lawsuit against Citigroup in New York state court, the Journal said.

The fund contends that a Brazilian investment manager acting for Citigroup tried to force the fund to sell its shares in two Brazilian telecom companies at prices below market value, the newspaper reported.

The suit is seeking compensatory and punitive damages, the Journal reported. In addition, the report noted that Globalvest was separately suing the investment manager, Daniel Dantas, and CVC/Opportunity Equity Partners LP, a $600 million private equity fund in which Citigroup is the sole investor.

The latter suit is in a Cayman Islands court, the report said.

Citigroup’s business practices have faced other legal and regulatory challenges recently. In September, Japanese regulators terminated its private banking license amid questions over its sales and lending practices in the country.

The special administrator of insolvent Parmalat is suing Citigroup and several other banks for $10 billion, contending they acted with complicity in defrauding the Italian food company, its shareholders and creditors of billions of dollars.

But Citigroup said on Monday that the administrator’s claims of complicity in Parmalat’s accounting scandal were “factually baseless,” and “unfounded and completely false”.

A Citigroup representative was not immediately available for comment early on Tuesday.